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Saab is saved from bankruptcy
It looks like Saab is safe. It’s to be sold to two Chinese companies, car distribution company Pang Da and manufacturer Youngman. But it will continue designing, engineering and building cars in Sweden, with Chinese manufacture coming on stream later.
And so concludes (or should conclude, subject to approval by various banks and regulators) an astounding cliffhanger, with Saab having been in mortal danger for most of this year. Many deals were almost done to save it, but none went through. Meanwhile, because it had no money to pay suppliers, no Saabs have been built in Sweden since April.
In addition to the comparatively small €100 million they’re paying for Saab Automobile, the new joint owners have at least €500million (£430m) to invest in keeping it going. This figure is according to Saab’s current boss - and part owner - Victor Muller (pictured above). The Swedish authorities who have been administering Saab’s bankruptcy protection must have been convinced that such a sum is available. Otherwise, within days, the administrators would have pulled the plug, pushing Saab into terminal bankruptcy.
In fact, the two companies had offered €245 million for a minority stake in Saab back in the summer, but a deal never happened. That they’ve now got the whole business for a much smaller sum would seem to indicate how difficult the situation was getting.
So what does it all mean? At a human level, it means the survival of a large car plant, and therefore thousands of jobs at both the plant and its suppliers. Saab’s demise would have been economic doom for a large Swedish region.
It also means the new 9-3 should be back on track for 2013. This morning, Muller told Top Gear that although the factory has been closed since April, the development of the 9-3 has stalled for only a couple of months. We know it has a Jason Castriota-designed body that could realistically be described as a four-door version of the PheoniX concept car without the wild wings. The petrol engine is the Mini turbo 1.6, and there’s a 4WD version with electrically driven rear wheels. An open-source operating system similar to Android will provide an ecosystem of car-related apps for its information, comms and entertainment systems.
And as soon as the factory starts production again, likely to be early in the new year, there will be the new 9-5 estate, as well as the saloon.
In the longer term, Muller wants to build a 9-1 small car and a 9-6 crossover. He has no formal role in the new company, but expects he will be kept on for strategic advice. Castriota will remain as consultant design leader.
So why did Pang Da and Youngman want Saab, a consistent loss-maker for decades? Muller says: ‘They have bought the only remaining premium car maker. It can be an alternative to BMW, Audi and Mercedes.’ This is the grand vision that has eluded Saab for decades, partly because it needs a bigger home market than Sweden. And that’s where China comes in: ‘China will be its second home market. It can sell 200-300,000 cars a year there by 2016.’ For comparison, that’s roughly the number as Audi sells there now, and it’s a quarter of Audi’s total output. Saab’s total output has seldom topped 100,000.
Some ‘ifs’ remain before the sale goes through. Chinese and Swedish authorities who’ve blocked previous deals will have to say ‘yes’. But Muller is confident because this deal is essentially simpler, a straight sale of the company.
In any case, there was a palpable sense of relief and optimism coming down the line from Trollhattan this morning. And it hasn’t been that way for a very long time indeed.