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Just about 100 more Saabs will roll off the line after the Swedish automaker decided to send some employees back to finish incomplete units still standing in the factory.
The company was plagued with financial problems after changing hands from GM to Spyker Cars and ultimately Swedish Automobile. That forced them to shut down despite attempted rescue investments by Chinese companies, Zhejiang Youngman Lotus Automobile Co. and Pang Da Automobile Trade Co. Unfortunately for Saab, GM, which manufactured the 9-4x crossover, said the move would unfairly share their technology in key markets and subsequently blocked it.
For now, new Saabs can still be seen on the road, and the company’s North American operation is trying to find a way to honor existing warranties, but the brand will soon be little more than an automotive relic.
Saab has officially been struggling for two whole years now, since its problems first came to light in December, 2009.
With time, it has seen some positive developments, but things don’t look any better for the foreseeable future.
A few months ago, Saab had received a court order that prevented its creditors to push the company into bankruptcy. It would use this time to reorganize. However, Saab’s owner – Swedish Automobiles NV, has said that Saab and its creditors have just five to six days to submit their views to the district court in Sweden. The court will decide whether to end the reorganization and push the company into bankruptcy.
Despite attracting two major Chinese companies (Pang Da Automobile Trade Co. & Zhejiang Youngman Lotus Automobiles) to invest in Saab, there have been delays in getting the necessary payments from the Chinese, and production lines have been sitting still for almost an entire year.
Saab previous owner, General Motors also has some objections. Most of the technologies found in current Saab vehicles is licensed from GM, and it does not want to support a sale of Saab that could hurt its own position in China.
GM currently builds the 9-4X for Saab in Mexico. If GM pulls the plug on their deal with Saab, it would be impossible for the company to survive in its current form.
Stay tuned, as this drama is far from over just yet.
[Source: Automotive News]
Saab’s sob story saga might be coming to an end, though the information surrounding their pending acquisition is murky at best.
Rumors swirled quickly around the media yesterday that the Bank of China, fourth-largest by market value had planned to acquire just under 50 percent of the company. Those reports are now being corrected— it’s a bank in China, but not the Bank of China. Regardless, this investment could be the savior Saab prayed for after GM flatly rejected their previous partnership with Zhejiang Youngman Lotus Automobile Co. and Pang Da Automobile Trade Co.
Pang Da operates dealerships in China, while Youngman manufactures Chinese vehicles under the Lotus brand.
According to GM, that partnership would jeopardize their own interests in China because they supply both parts and the 9-4X crossover, which would then be unfairly accessible to the Chinese companies.
Saab hopes the new deal will keep GM satisfied while allowing them to finally be rid of their debt, which includes unpaid salaries and bills.
“The discussions include a short term solution to enable Saab Automobile to pay November wages and continue reorganization. The outcome of the discussions is still uncertain,” Saab said to Automotive News.
Saab parent company Swedish Automobile originally hoped for Pang Da and Youngman to take a combined 53.9 percent share of Swedish Automobile, but nothing in Saab. The two companies pushed instead for full ownership of Saab.
Gallery: Saab 9-4X
[Source: Automotive News]
Saab‘s matchmaking saga is the stuff of cinema. Facing compounding financial dilemmas and a series of unsuccessful talks with a number of investors, the troubled Swedish automaker had little going for it. Just as Saab was close to finally making a deal with its Chinese investors, Pang Da Automobile Trade Co. and Zhejiang Youngman Lotus Automobile Co., the company faces yet another challenge that may prevent the deal from happening.
General Motors Co., the former owner of Saab, is looking to prevent the Chinese acquisition. GM spokeswoman Renee Rashid-Merem claims, “GM would not be able to support a change in the ownership of Saab which could negatively impact GM’s existing relationships in China or otherwise adversely affect GM’s interests worldwide.”
Removing Saab during its 2009 bankruptcy restructuring, GM still owns the technology that Saab uses to produce two of its models. Also, GM has built the 9-4X in Mexico for Saab this year. If bought by Pang Da Automobiles and Youngman Lotus, GM is concerned for the intellectual property that is licensed to Saab.
As roadblocks mount, it is becoming clear that time is running out for Saab. The Swedish brand sold 49,000 units in the United States in 2003 and have now dropped to only 5,800 models sold for 2010 nearly a 90-percent decrease. Through October, only 4,984 units have been sold in the United States so far this year.
[source: Detroit News]
After much back and forth over the past months between Swedish Automaker Saab and Chinese suitors Pang Da Automobile Trade Co. and Zhejiang Youngman Lotus Automobile Co., it seems like funding for Saab is very much back. The Chinese companies have both agreed to buy the Swedish automaker, providing the company with some much needed short and long term liquidity.
The details of Pang Da and Youngman’s agreement are an initial commitment of EUR 50 million to fund Saab Automobile while in reorganization. Next, the Chinese investors will then provide at least another EUR 600 million in funding to restart production and to settle the company’s debts and liabilities, allowing the company to concentrate on matters moving forward.
However, the condition that broke the agreement in the past may cause an interference again. This deal can only become a reality if the Chinese government chooses to give its seal of approval.
According to Saab’s restructuring plan, production will resume in Sweden and Mexico while considerations for assembly in China will be addressed as well. Immediate targets for Saab include the introduction of the 9-4X crossover and the 9-5 SportrCombi wagon. Saab aims to sell up to 55,000 vehicles for the year 2012. In 2010, Saab only managed to move 32,000 vehicles.
Pang Da and Youngman are optimistic that Saab has what it takes to become a profitable company. While 2012 will be a transitional year of reconstruction, the Chinese hope that Saab profitability will return for 2014.