Swedish carmakers Saab and Volvo are in a similar predicament. One is owned by struggling Detroit carmaker General Motors and the other by Ford, and both are being spun-off from their respective parent companies in light of significant losses over the past couple of years. For Saab, GM simply cut its ties and the carmaker is now in the process of seeking a new owner. Volvo, on the other hand, is being auctioned off by Ford to the highest bidder.

While both of these solutions appear to be the most practical given the current financial state of the two carmakers, GM vice chairman and product czar Bob Lutz thinks a better option would be if the two simply merged. "That way both we and Ford get rid of a problem," Lutz told Swedish newspaper The Local.

Whether or not a merger between two companies with repeated losses and a similar product lineup is a good idea remains to be seen, but the concept is nothing new. Saab and Volvo considered merging back in the 1970s and have also looked at sharing models and platforms over the years.

Despite the merger suggestion, Lutz confirmed that the main objective remains to find a buyer for Saab and we suspect Ford has a similar plan for Volvo. Saab managing director Jan-Ake Jonsson revealed yesterday that there were a total of five parties interested in acquiring the firm and the first bids for Volvo are expected to be submitted to Ford as early as next month.