Saab saved by SAS

She acctually first said "In the future the government sees no intrinsic value in owning SAAB" but then corrected herself - freudian slip perhaps? :)

Cheers, Niclas

Oh, and the newspaper had an addtional article on why SAS gets money and not SAAB and came to the conclusion (I have adjusted the Google translate text):

"SAS may go bankrupt, then there is no collateral at all and the state may not charge a dime. In comparison a Saab plant is far better to own."

Cheers, Niclas

Translate Url: http://translate.google.com/translate?hl=en&sl=sv&tl=en&u=http%3A%2F%2Fwww.svd.se%2Fnaringsliv%2Fnyheter%2Fvarfor-far-sas-pengar-men-inte-saab_4232765.svd

Here's Aftonbladet critizing the government for pouring money into SAS and comparing "a crummy airline with a crummy car factory"...which isn't crummy at all.

http://www.aftonbladet.se/ekonomi/article6570660.ab

http://www.airliners.net/aviation-forums/general_aviation/read.main/4705992/

will shed some light on the issue but SAS is a mess,

Hypocrisy at its finest. I will do my best to vote this lady out of the government.

I have no problem with governments taking stakes ( or owning them from historical legacy) in businesses. I hope that they can sort out SAS althogh the airline business is one that makes the auto industry look healthy by comparison. My father in-law is an investor with quite severe views on some things and he often claims that if he were around on Kittyhawk beach when the Wrights from first made their flight he would have done 100 years of investors a favour and shot them down. That may be a mangling of a Warren Buffett/Charlie Munger quote but its still quite funny anyway.

The stark comparison with the Saab situation shows the one-dimensional nature of politics in all its glory. Justify it how you like Ms Olofsson but its pretty ordinary in my view.

Yes, it is indeed a dilemma this, and the discussions about a continuing governmental support of SAS is now going hot in Norway as well

SAS is, in contrast to SAAB, state owned by Norway, Denmark and Sweden in addition of some private investors. It has always been like this. And, the airline has approx 7000 employees (rapidly decreasing I'm afraid) on the payroll.... And, the so called ageing SAS fleet is only partly correct. A part of the fleet is MD80 series aircrafts from late 80s and earliy 90s, and they are difficult to get rid of in todays crizis in the aviation industry. The rest of SAS' fleet is relatively new generations of Airbus and Boeings. But: as far as I know SAS has in total not had black numbers in their books for years so it's absolutely reasons to believe that the airline has been mismanaged even long before this general crizis in the aviation industry started.
Based on that I can somewhat understand why the scandinavian governments do this echonomical support to SAS, but at least the Norwegian Industry Minister was very clear when he said this is the last time we do this kind of support.

Basically governments shouldn't own airlines, car factories etc, but we should not forget that this kind of ownership is not unknown here in Scandinavia. Such ownership has more or less been a tradition from the past, but it is changing winds now. On the other hand I am not t h a t much against state ownerships. Take a look at the norwegian oil and gas industry as an example; I think it was a corrrect decision to establish the state owned Statoil ( http://www.statoil.com/en/Pages/default.aspx ) to take care of our national interests when the oil era took off. Statoil is now just partly state owned and registered at NYSE, but it has been the most important company for Norway for years - and still is. And for those of you still meaning Scandinavia is a group of 'communist states' because of this; you are definately wrong :).

What this has to do with SAAB? Nothing much perhaps, SAAB was after all owned by an american company. That said, let's not forget that the Swedish government finally has jumped in and guaranteed to a huge pile of money for SAAB, so they have done s o m e t h i n g for SAAB as well even there is a huge potential for a improvement in how the Swedish government handled this almost until the point of no return for SAAB. Now SAAB seems to be saved even with the help of the Swedish government, and we're all extremely happy for that! Victor Muller will from here take SAAB to a higher level, I am sure.

Bottom line from me is that I really don't like a too high state involvment in it's industry, but I can also see why they a r e doing this/not doing this. It's a lot of dilemmas related to this, no easy answers.

Sorry for perhaps going somewhat off topic here, but since it was you Swade bringing the issue on the table I guess I might be forgiven :)

Cheers from Norway
-Olav-
Always on the longest road home when out there with my privately owned SAAB. Always!

Personally, I have despite my love for Saab all the time meant that the government should not take over the ownership of the Saab car brand. I think that Sweden's experience of the shipyard crisis would have made such a decision to a political suicide for the government in our country even if the Social Democrats were running "the show".
But in the case of SAS, I have actually difficult to see how the government could act otherwise than what you are doing now. I would rather think it would be hypocritical of the government to first during one year say to GM to act responsibly as the owner and then when your own company bleed do nothing. Nah of course one can try to draw parallels between Saab and SAS, but for me it's to no avail. It is also not a secret that the government wants to sell there share of the airline, and to do so it is an advantage if there is something of value to sell

So, the owners of GM should have been the US Government, the Canadian Government, and the Swedish Government. And, when Ed sells the new GM stock all the governments would have been happy campers.

The old GM stock is now worth pennies. Just wanted to say thanks for that to the US Government.

20% is not a very big ownership stake. Sweden should have gone for at least 60%, then the Swedish government could have fired the old guys.

Just a thought.

In the 70s and 80s when I grew up, there were two major airline companies in Norway: SAS and Braathens. The government not only owned part of SAS, but they also got to decide which airline company would service which cities...

In the end, it became impossible for Braathens to compete and they were swallowed by SAS.

OK, I can agree that government ownership of such businesses is not a good thing. But... Surely there is a middle ground somewhere? Sweden could have bought Saab, allowed them to start executing the business plan at hand, and at the same time spent time looking for a new owner. Or they could have offered a loan that stretched longer than only 6 months into the future. Or they could have offered a EIB loan on their own, in case EIB backs out... etc...

SAS brings nothing unique and important to the table. It is basically a bus company that happens to service their passengers with big buses with wings attached. The technical knowhow of Saab's engineers alone is much more important than anything SAS has to offer. And that knowhow should not be wasted on designing giant propellers that are going to litter the landscape in remote (and not so remote) locations.

SAS is the proof of what I have been repeating several times before. Once a state invests in a business enterprise, they become its slave. If anything goes wrong they have to pay to keep it alive. Now I am waiting to hear GM (after they succeed in begging from European governments) after a couple of years of mismanagement will take a (company) jet to Washington to ask US govt for more money. I am really happy that Saab was forced to create a realistic business plan and find private owners. After the one year long fight to survive Saab management will think twice while taking any decision. Saab has a chance to be the really healthy business organization. Good chances in future.
State owned companies have one in common: you can pump lots of money into them every year and they change nothing in the way they work. (sometimes I think that private veterinarian med service in Poland is much better than state medical help for people - I always have this thought when we take my parents poodle to a doctor...)

"sometimes I think that private veterinarian med service in Poland is much better than state medical help for people"

Sounds just like Sweden!
Sure, they have medical expertise in Sweden, but they sure don't want you to access it. If you are really I'll you are probably to weak to be able to get proper help. (Been in that situation myself.)

About the state being hostage to the state owned companies: 100% true.. The public purse can always be expanded just a little more! You can live with 50% tax? Well, 51% can't be a problem then!