SvD casts a light on the chinese situation
May 21, 2011 in Uncategorized
Yesterday we reported about some “rumors” that the Saab deal could be in jeopardy, we did not know basically anything about the background of the information but there were several chinese and european media that focused on the story which made it credible for us as well. Today SvD’s Jonas Fröberg, which is probably the reporter in the world who I respect the most, have analyzed the situation and it seems as if yesterdays rumors were not unfounded!
In the article below some real facts are stated (original article here):
Barely had the Saab contract with Pang Da been signed until the problems start again. At a secret meeting this week signaled China’s leaden National Development and ReformCommission, NDRC, the vehicle group, that Youngman has first dibs at Saab. There is a huge setback for Muller who wish to involve Pang Da as a partner. According to SvD Näringsliv sources called NDRC, which must approve all major business in China, at a special meeting about Saab in Beijing May 18, The subject was the saga of the Saab Spyker in China. And the message was clear: the vehicle group Youngman that Saab / Spyker previously negotiated with still have the primary right to go in as the owners of Saab.
This means that Saab’s long-term funding could be jeopardized. Pang Da, which has signed a letter of intent to purchase by 24 percent and adding over 600 million is blocked as long as Young’s application is contained by the NDRC.
- NDRC’s message at the meeting was that they would strictly enforce existing rules and policies governing foreign investment. This means that it is the company who submitted the application first which has the right to make the deal, “said an informed source who wishes to remain anonymous.
Youngman is the only company that has already submitted an application for state investment in Spyker. Under current policy in China can have only one application at a time for investment into a foreign car-manufacturer.
The news comes at an extremely delicate situation for the Saab / Spyker, which is currently negotiating with all the over 800 suppliers to start production. Several vendors have indicated that they do not want to deliver until long-term funding is secured.
The rule that only one company may have application for a foreign company came to prevent competition among Chinese brands of foreign automakers. NDRC said to be seriously concerned about the frenzy for foreign partnerships that exist in the Chinese automotive industry. Present at the meeting of the NDRC was more of Saab’s previous Chinese suitors, Hawtai, BAIC and Youngman, and local agencies of the Commission, according to SvD’s sources.
In agreement with Pang Da became known, emphasized Saab / President of Victor Muller Spyker, that you could get around the NDRC’s policy because Pang Da is a sales chain, similar to Swedish Bilia, and not a manufacturer.
But it is only the first part – the Pang Da advance payment for 1300 Saab cars which means that Saab has already received 270 million. As for the next part – the Pang Da will buy into the Spyker, who today generally only includes Saab, therefore, permission from the NDRC is needed.
Victor Muller told SvD Business that he had received other reports from the meeting.
- It’s not the information we have received from that meeting and we received first hand reports from there. The fact that our deal with Pang Da would be blocked is absolutely incorrect, “he says.
So you think Pang Da will be able to enter as a partner?
- Yes, I am convinced, “said Muller.
NDRC, is the mighty Chinese super-ministry, which must approve all overseas Chinese investment. Even when it was subsequently wrecked, the deal with the manufacturer Hawtai, familiar sources spoke, that Youngman had ample opportunity to be a problem for Saab in the future.
No one from Youngman want to comment on SvD Näringsliv whether they will assert their rights. But it is quite clear that Youngman was a thorn in the side of Victor Muller.
Youngman claim they had a written agreement which forbade Muller to negotiate with other Chinese players as long as their negotiations were ongoing.
But Muller had simultaneously pursued negotiations with several other Chinese players. This has also caused made Chinese media to raise their eyebrow. The government newspaper Economic observers similarity in Saab / Spyker’s conducts to a woman who is engaged in three relationships at the same time and wrote that the Chinese government will not allow it, according to Dagens Industri.
Young’s CEO Rachel Pang has previously said that she did not want to comment on the matter with journalists, but added this:- Check the rules yourself, “said Rachel Pang to SvD Business.
My belief is that Victor Muller knows more than the newspapers and is prepared for this. He is a very smart businessman and is surrounded by people who know the chinese rules and regulations. For him to make a simple mistake like this seems to me like a very unlikely situation.
Thanx ThomasJ for the info about this!
marq101 said on May 21, 2011
See my mail from yesterday (saabclubnl)
Hans H said on May 21, 2011
Are companies realy fighting for Saab? That might perhaps be considered a good sign. It must be better than the opposite anyway.
JasonPowell said on May 21, 2011
This would be a great story to be spread everywhere, maybe if the Swedish Government realized that companies are fighting to be a partner with Saab, they could actually feels some pride for they’re iconic brand and step in and say “screw it, nobody’s getting in, we want in and want to keep what’s ours”. I seriously doubt that they have the mental capacity to see things that way, but it would be nice.
TukanSaab said on May 21, 2011
Swedish Government WAKE UP!!!!!!! The Chinese are playing this game to scoop up the ashes and steal the technology!!!! Get your heads out of you *sses and secure your only remaining auto manufacturer. The NDRC, just like the Japanese, have a WAR mentality when it comes to negotiations. They are in this for global footprint and their plan for economic hegemony. Pathetic that our leadership let Sweden’s future disappear. Indeed it is happening all over the West.
I must say you have to hand it to the Chineses. The sotries and laughs behind closed doors re these dealings must be great and hearty!!
scottishsaab said on May 21, 2011
Is VM doing saab any good just now? I can’t believe he didn’t know about these regulations before he went running around looking for money!! All these problems and yet a promise to start production in 7 days..
Olav said on May 21, 2011
Depends on whom to believe; The Press or VM. The Press has time after time showed their bad judgement, constantly echoeing each other. VM seem to be an honest man, and the one sitting closest to the sources. I believe in VM – he is really living up to his motto: for the tenacious, no road is impassable
VM up!
Cheers from Norway
-Olav-
Still keeping calm and carrying on driving the longest road home when out there with my SAAB. Always!
Audun said on May 21, 2011
TTELA.se has just published a far more positive article about the same.
Niklas G said on May 21, 2011
Yes that article was indeed a good summary of the situation, and VM is of course more concerned than anybody else to propose a deal that is both good for Saab and allowed by NDRC, so I’m sure that VM together with Pang Da and others are working hard to stay informed on exactly what rules NDRC follows and negotiate about a deal that follows those rules. (A Saab/Spyker-Pang Da-Youngman joint venture or whatever they finally decide on). And anyway, we can’t do anything but trust VM’s good judgement and keep fingers crossed for a positive outcome.
Audun said on May 21, 2011
I hope SaabsUnited update this post, or make a new post. I sent a link to the article to them.
Peter, Sweden said on May 21, 2011
I can’t believe you prefer listening to rumours and media instead of listening to Victor himself.
TonymacUK said on May 21, 2011
VM has been playing poker with the Chinese – a dangerous game as they are born gamblers and very good gamblers at that! VM might have been too clever this time. I also get the impression that Youngman are biding their time, they know that SAAB is on its knees – they won`t move until the axe starts to fall and they can get SAAB for a song.
Jasper said on May 21, 2011
Ah…. do we miss GM?
DTCRO said on May 21, 2011
I would not say it is bad news, quite different as if there is many interest in Saab it is question only of time when full long term partner for Saab will enter (and VA of course is major part of puzzle). For me it is normal and there is enough time to polish all deals that we know only small part. Anyway shares buying fromPang Da was not to be expected within several months so all this suppliers if reading this start to deliver parts otherwise it is only more you can lose. Have little faith as we Saab supporter have.
Audun said on May 21, 2011
I agree with you.
Jeff said on May 21, 2011
BAIC is state owned (Pang Da’s heretofore preferred partner), Youngman is not. ‘Nuff said.
Khrisdk said on May 21, 2011