SaabsUnited.com

I can’t tell you how good it is to read this…..
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Saab On The Road to Independence
* Swedish court process to reorganize Saab into a fully independent business
* Three new models ready to be launched over the next year and a half
* Saab aims to bring resources back to Sweden
* Funding sought for “new independent Saab”
Trollhättan. As a result of GM’s strategic review of the global Saab business the Saab Board announced today that it will file for reorganization under a self-managed Swedish court process to create a fully independent business entity that would be sustainable and suitable for investment.
The reorganization is a self-managed, Swedish legal process headed by an independent administrator appointed by the court who will work closely with the Saab management team. As part of the process, Saab will formulate its proposal for reorganization, which will include the concentration of design, engineering and manufacturing in Sweden. This proposal will be presented to creditors within three weeks of the filing. Pending court approval, the reorganization will be executed over a three-month period and will require independent funding to succeed.
“We explored and will continue to explore all available options for funding and/or selling Saab and it was determined a formal reorganization would be the best way to create a truly independent entity that is ready for investment,” said Jan Ake Jonsson, Managing
Director for Saab Automobile.
“With an all new 9-5, 9-3X and 9-4X all ready for launch over the next year and a half, Saab has an excellent foundation for strong growth, assuming we can get the funding to
complete engineering, tooling and manage launch costs. Reorganization will give us the time and means that help get these products to market while minimizing the liquidity impact of Saab on GM.”
Funding for the restructured company will need to be secured during the reorganization process and will be sought from both public and private sources.
Saab will continue to operate as usual and in accordance with the formal reorganization process, with the Government providing some support during this period. The reorganization should have no impact on other GM operations. Details of the progress will be provided as milestones are achieved.

All times are Swedish time:
Thanks to those in comments for providing these.
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9:05am – Saab employees have been asked to leave the factory – via email from Swedish press.
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09:10 FLASH: Saab are about to reconstruct
Saab have filed an application for reconstruction, says Christer Nilsson in Saabs informationdepartment according to Ekot (a Swedish news agency).
Christer Nilsson retired over a year ago. This doesn’t make sense – SW
More on this……
Saab has submitted an application for reorganization to Vänersborgs District Court, states Swedish Radio Eko.
Clearance from the district court whether it be accepted is expected during the day, “says Christer Nilsson on Saab’s information to Ekot.
Under a reorganization creditor can not ask the company into bankruptcy and part of the debt can be written off.
Saab will provide more details at a press conference at half three in the afternoon.
Other reports say 14:30 – SW
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www.sr.se claims that saab has filed for reconstruction.. press conference at
14.30 swedish time
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From AMS:
During the press meeting, the following areas will be affected:
- The future of Saab Automobile
- Reorganization Decision
- Saab as an independent business unit
According to the press release Saab sent out should you become a fully independent company with the intention to become attractive to future investors. The aim is to design, construct and build cars in Sweden, Trollhättan. The reconstruction will last for approximately three months.
A complicating factor is that the situation for Saab owner General Motors is not clear until the end of March, when the U.S. authorities decide whether they can put up with more loans. If General Motors does not get the loan of 16.4 billion dollars that you need can GM be forced into bankruptcy.
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JAJ via Reuters:

“We explored and will continue to explore all available options for funding and/or selling Saab and it was determined a formal reorganization would be the best way to create a truly independent entity that is ready for investment,” Saab Managing Director Jan-Ake Jonsson said in a statement.
Saab said funding for the restructured company will need to be secured during the reorganization process and will be sought from both public and private sources.

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From e24
Saab becoming an independent company and announces that it will launch three new models within the next 18 months.
The company is launching a brand new Saab 9-5, 9-3X 9-4X. All three models will be launched the next one and a half years.
- With all-new Saab 9-5, 9-3X 9-4X, all ready to be launched over the next one and a half years, Saab has an excellent platform for strong growth, assuming that we get funding for technology , processing and launch, “says Jan Åke Jonsson, CEO of Saab, in a press release.
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UPDATE – Important note to remember at the bottom!
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Time for me to cover what many of you Swedes would have already read. I’ll cover it anyway for the benefit of the non-Swedish speakers here and for the archives.
Auto Motor and Sport have written that Saab will be pronounced dead as of today – February 20th 2008.
They say that Opel will take a big, big hit as well.
A translation from Googlie wooglie.

During the Friday morning announcement [this] could come: General Motors is [killing] Saab! If bankruptcy becomes a fact it means that a 62 year-old car era is over….
…Normally, it should perhaps not be so personal a disclosure [in] articles on the automotive industry. But [this] SEASONED motoring journalist may have debris in the eye when the old Saab-veterans are calling on cell phone crying: “Now is the end, GM is running us in ??? (into the ground? – SW). I worked for Saab all my life – this is a bitch!”
…..several independent sources, the same thing: Today, Friday the 20th of February General Motors announces that Saab Automobile AB goes bankrupt. The message must go out during the morning. We have not been able to get any confirmation of the data, from Saab’s page is the “lid on” and no information has been published since Thursday lunch.

I’ve also tried calling Saab this morning. People are answering the phones, but understandably, the people I need to speak to are all busy.
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From another report, The Gothenburg Post reports that suppliers are withholding parts, trucks are turning back from Germany and people’s belly buttons are mysteriously changing from ‘innies’ to ‘outies’
OK, the last bit isn’t true, but you’ve got to try something to cheer up!

Deliveries are withdrawn
According to the GP experience, several suppliers in Germany has ordered that trucks on their way to Trollhättan to go back to Germany with the loads.
Because of the uncertain situation prevailing currently stopped a subcontractor, PE Plastic in Värnamo, its deliveries to the Saab factory in Trollhättan yesterday.
The company’s CEO, Patrik Ekwall, had only an oral agreement with Saab. Now he wants a written. While the supply of small plastic parts to Trollhättan stopped in Värnamo started a dialogue between the parties.

That article also predicts that if Saab go under, they’ll most likely take around 40 subcontractors with them. That’s most likely going to effect supply for Volvo as well.
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This is all news that is around 10 hours old right now.
It’s 7:41am in Sweden as I write this. Let’s see what the day brings.
And REMEMBER – this was all written before the story stating that GM are willing to guarantee $450m in loans from the EIB. That offer my be enough to entice the Swedish government to save Saab and all these flow-on suppliers.
All of you Saab people reading this, please let me know if you hear anything. This company must survive!!

GM have seemingly returned Maud Olofssons forehand with a backhand cross-court drop shot.
From Reuters:

General Motors Corp (GM.N) is prepared to pump in $400 million to help make its Saab car unit profitable if the Swedish state guarantees an even bigger loan to the firm, Swedish daily Dagens Industri said on Thursday, citing unnamed sources.
The newspaper said GM had told unions at a Saab board meeting on Thursday it was prepared to put 3.5 billion Swedish crowns into the firm if the Swedish government guaranteed a 5.2 billion crown loan to Saab.
Part of the money would be used to launch new models and part to cover the loss made by Saab last year. The goal is to help it reach annual sales of 120,000-130,000 vehicles, which would make the firm profitable by 2011 or 2012, Dagens Industri said.

The Saab board is due to continue its postposed meeting from yesterday, sometime later today.
More on this shortly….
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So – the proposal – as best as I can tell:
GM will act as guarantor for a $450m loan from the EIB and ask the Swedish government to guarantee a larger loan from the EIB in order to bring Saab’s new vehicles to market.
Saab will bring out the 9-3x, bring the 2010 9-5 and the 9-3 convertible production to Sweden. I assume this money would also cover the final costs of finishing and launching the 9-4x.
Saab would hope to sell it’s 9-3, 9-3conv and 9-3x as well as the new 9-5 and 9-4x in [much] better numbers through the end of 2010.
As I see it, the fault in the plan is that Maud Olofsson wants to see a sales rise straight away. This money they’re asking for is just to get Saab through this year, with very little in the way of new models to sell. It’s most likely going to be 2010 before Saab see a real sales rise as that’s when the new models are scheduled to come out.
It’s only a year, but it’s a year too long for the Swedes (and for GM, who want to cut Saab off Dec 31st, 2009).

Mats K has translated an article that appeared in the Goteborgs Posten today.
It almost sounds like a eulogy, but I ain’t buying that. What it is, however, is a good quick examination of the injustice that’s been served up to Saab, both in terms of past practice and future potential.
Here’s to that potential being realised.
Thanks to Mats for the translation.
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Saab could have gone so far…
General Motors involvement with Saab has – at best – been favorably uninterested. It could have been much better.
Right now a model lineup previously unparalleled by Saab is sitting in the GM garage waiting to roll out. This is when GM pulls the plug. This has been typical of GM’s behaviour during the time period they have owned the company.
it is no coincidence that there are so many outspoken Saab enthusiasts around the world. People who love the brand unconditionally. After all, only an enthusiast could love the sputtering and smoking front wheel drive two cycle engines, the odd shapes, and the innovatively unique solutions. Out of this, and the cluster of safety-minded thinking where even Autoliv (Airbag, etc. supplier), Volvo and Chalmers University were involved cars with personality and character were developed.
In the U.S, Saab has been the car of those with high intellect. Not the university students’ car, but the car of their professors. Saab was also among the very first brands to launch the small turbocharged engines of the sort that environmentalists prefer, and most major car companies are investing in today. And they were Born from Jets. (sarcasm)
In other words, Saab has had a base as heavy as lead, full of values and image in its brand which – if skillfully managed – could have gone limitlessly far with a global industrial firm like GM behind it.
Out of all this came nothing.
For a number of years GM sent managers to Trollhättan, some of which became popular, but none of which amazed us with their dynamic drive. The interest from the top of GM in what they were actually doing at Saab always felt – at best – marginal.
Peter Augustsson came from the resource rich company SKF (a ballbearing maker) but when milllions were spent on the development of the current 9-3, GM management were finally fed up and decided to put Saab in order. The final straw was the discovery that the 9-3 was developed on the Opel/Vauxhall Vectra but still had a ton of parts that had been modified by Saab at great expense. The engine mounts were moved, the electrical system modified and the fuel tank was designed by Saab.
A former manager at Saab put it like this:
You have an ocean of engineers who receive a fuel tank and are asked “Can you make it better?” Well, of course it can be made better if it is allowed to cost a hundred million. When GM discovered what was happening they decided on a quick fix: A Subaru with a boxer engine (Something Saab had never had) was given a makeup job and named the Saab 9-2.
Fiasco.
A more serious try was made with a Subaru crossover model, but by this point in time GM’s poor finances had already started to affect the business, and the ownership stake in Subaru was sold. Saabs crossover model was canceled.
Instead another makeup job was done, this time with an enormous American SUV, the Chevy Trailblazer that was called the 9-7x. This model was only really sold in the U.S.
Then it was decided that the Saab 9-3 and 9-5 were to be built in Germany’s Rüsselsheim plant, but before the decision was put into effect, the 9-3 was back in Trollhättan again. The 9-5 was delayed and still has not started to be built.
At the same time a new crossover, the 9-4x, has been developed. The intent is (has been?) to build it in Mexico. A new futuristic convertible has been shown as a concept. An even newer 9-2 to be made alongside the 9-3 in Trollhättan has been discussed. Collectively the most exciting modern model lineup Saab ever could ahve dreamed of.
Now they look to remain a dream.

Saab are rumoured to be meeting on Friday and filing for a procedure referred to as “recontruction” or reorganisation.
David B asked the following in comments:

If I may be so stupid to ask: what does it actually mean for Saab if it goes into “reconstruction/reorganisation/bankruptcy”? This terms seems to me to be the end, but from what I’m reading it’s not…?

I covered one line of thought about this yesterday, but there’s been another article from the BBC which I think explains it quite well.

The reorganisation process is the Swedish equivalent of going into Chapter 11 bankruptcy in the US.
The company applies to the district court for a reorganisation ruling.
If it is granted, an administrator is appointed, but the current management continues to run the company.
The administrator helps negotiations with the company’s creditors to decide how much of their money they will receive.
The reorganisation lasts three months and may be renewed by the court, up to a maximum of one year.
During that period, the company is not allowed to pay off any debts that were accumulated before the reorganisation was declared.

It’s not the end of the road yet.
The news out of Sweden in the last 12 hours hasn’t been encouraging, but I’d encourage a little patience and waiting for Saab have to say about what they’re doing, rather than just the speculative stuff that’s firing in all directions.
A friend in Trollhattan wrote to me earlier this week saying It ain’t over until the fat lady sings, and there ain’t many fat ladies in Sweden!

As I head off to bed, the situation is as follows:
A number of Swedish news outlets were saying that Saab were in a board meeting as of 11am this morning, Swedish time.
BUT
As I started writing this, Dippen chimed in with a report stating that the meeting had been cancelled…..
BUT
NyTeknik claim that this guy, literally – Guy Lofalk – is going to be the administrator that will supervise the reorganisation of the Saab business.
I suspect that this report is speculation rather than confirmation of the appointment.
E24 have talked to a specialist who reckons that Saab have about 3 months to execute the reorganisation and wonders if there’s any more value that can be unlocked with Saab.
Again, this is just an opinion piece and opinions right now are like Hyundai Excels back in the late 1990s – everyone’s got one.
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There’s reports flying thick and fast at the moment. I will attempt to contact Saab but I have a feeling they’ll be a little busy today.
In the meantime, perhaps some of you Swedes can keep us up to date with what develops.
Damn time zones!

The plot thickens…..
Just as Swedish news services are reporting that a Saab board meeting is taking place where they’ll consider filing for a business reorganisation plan, a representative of the European Investment Bank has confirmed on Swedish radio that Saab have applied for a loan with them.
The translation:

EIB confirms Saab’s application for loan
The European Investment Bank, EIB, has confirmed that Saab has submitted a request for a loan, and also submitted its business plan as a basis for the loan.
Mats Gunnarsson, advisers EIB:
- We can confirm that we have had talks with the Saab and they want to borrow money by the Bank. The next step is that we make an evaluation of the business plan and the project that the borrower wants to do, then we will make an internal decision here at the bank, “says Mats Gunnarsson adviser to the European Investment Bank.
If it would be commercially interesting for the EIB, it is thus clear that Saab would get a loan then?
- No, not in this case in that Saab is owned by GM, which has very low credit ratings. This means that in this case we will require additional guarantees, for example, a government guarantee.
So you can say that the ball is in government?
- Above all is that of GM and the government.
It seems that there is a degree of political influence over a loan?
- Yes, but we are also a political bank, we are owned by the Member States, so we are governed by commercial decisions but also political.

So whilst they’ve made the application, it would seem that the application was definitely made prior to Maud Olofsson getting all mad at GM. And it seems that the loan application has little-to-no chance of success whilst GM are Saab’s parent and the bank require a government guarantee.
Thanks Dippen!