“The Death Knell,” financial daily Dagens Industri headlined on its front page, while the country’s leading newspaper Dagens Nyheter blazed “It’s Over Now.”

In an analysis piece, conservative daily Svenska Dagbladet said “everything was pointing to the closure of Saab,” adding it was “unlikely” a new buyer would turn up.

Saab employs 3,400 people in Sweden and sold just over 93,000 cars worldwide in 2008. Sales have fallen by around 65 percent since the start of the year, while rival automakers have begun to see a recovery.

“Considering the galloping drop in sales this autumn and its rapidly dwindling coffers, the risk of closure is now imminent,” Svenska Dagbladet said.

Koenigsegg, which has just 45 employees and produces 18 high-end sports cars a year at more than one million euros ($1.4 million) each, cited costly delays in the takeover process as the reason for its decision.

It had announced in September that it was teaming up with Beijing Automotive Industry Holding Co Ltd (BAIC) to buy Saab from GM.

BAIC said Wednesday it would now “reassess” its options.

GM, which has said it wants to get rid of Saab by the end of 2010, said it would announce its plans for the iconic carmaker next week.

Dagens Nyheter, which called Koenigsegg’s bid “a joke from the beginning,” said that “unless a miracle happens — such as a quick and unexpected bid from BAIC or another Chinese manufacturer — then this is probably the end for Saab.”

“The decline in sales has gone too far, the brand has been damaged beyond repair,” it said.

While about 3,400 people are employed at Saab’s factory in Trollhättan, a town of 55,000 in southwestern Sweden, another 12,000 work for suppliers or subcontractors that directly rely on the automaker for their income.

“This is a tragedy primarily for the employees, who have suffered so much, hoped so much,” Dagens Industri wrote.

“It’s also a tragedy for the Saab brand, brimming with tradition and a proud history, so many strengths and possibilities — if only it had had the right owners.”

Saab started life in 1937 as an aircraft manufacturer — something which became evident in the aerodynamic, sporty shape of its first concept car designs.

The company built its first prototype cars in 1947 with the first production version rolling off the assembly line two years later.

Saab’s glory years came in the 1980s when a weak Swedish currency helped boost sales in its export markets, the US and Britain, where it gained a reputation for its turbocharging technology.