Operation cheetah
September 22, 2011 in News
TTELA (Original article here):
Saab might have to decrease the amount of employees at the company now that the reconstruction work has started under the code-name cheetah. The aim is to decrease costs swiftly and make the company much more efficient.
Saab has named its project after the worlds fastest animal “cheetah”. The project is described as a temporary measure and shall be finished at the end of october. At that time a project-team shall give its opinion about means of making the company more efficient, these measures shall then be implemented before the end of the year.
The goal is to decrease costs with 15% which will demand a 25% decrease of fixed and variable costs for producing the cars.
According to personell-manager and project-manager Johan Formgren the work has already been done for a while but it is now being accelerated due to the reconstruction decision.
- We can not ignore personel-cuts in an organization that has had problems. It’s all about becoming more competitive.
During the next coming weeks staff, purchase of services and marketing-costs will be looked over both inside and outside Sweden.
- We will for example look for places where the same work is performed in two places. We might very well stop doing certain things or stop or postpone certain areas. Nothing is dismissible right now. We have a tight organization right now yes, but I can not go into more details right now.
Cheetah’s aim is not to improve Saabs income. On that front more measures and activities as well as initiatives according to the company.
den said on September 22, 2011
go Cheetah go
will_269 said on September 22, 2011
Think about that comment Den!
Hans H said on September 22, 2011
Run Cheetah, Run !
den said on September 22, 2011
means, run Cheetah, we want production start very sooon
ANA said on September 22, 2011
Cheeetah or Grim Reaper?
ivo 71 said on September 22, 2011
Funny name if you speak Dutch, Flemish or Afrikaans. In these languages, the cheetah is called ‘jachtluipaard’. Which literally translates as ‘lazy hunting horse’. I have never understood why and could never find an etymological explanation but I sure hope that that ‘lazy’ bit doesn’t apply to the plan.
Ivo
xlx said on September 22, 2011
well, “jachtluipaard” looks also a bit like “yacht leopard”
a saab yacht ? whynot .)
Perret said on September 22, 2011
jachtluipard simply means “Hunting Leopard” – so nothing to worry about
Henrik B. said on September 22, 2011
More like “Hunting Leopard”.
Cheers!
ivo 71 said on September 22, 2011
Luipaard is, of course, leopard and jachtluipaard stands for hunting leopard. But the point is the presence of the ‘lui’ bit in luipaard. Because lui is the Dutch word for lazy. Maybe a leopard, hunting or not, is lazy when he is off his fast mode?
Ivo
Hans H said on September 22, 2011
All cats are lazy as often as they can. That’s the charm with cats.
Dannii said on September 22, 2011
Ivo – no, in Afrikaans, “jag luiperd” means a leopard that hunts, more at agile and adept as opposed to lazy, which is “luiaard” in Afrikaans. The word “sloth” for the latter comes to mind. At any rate, good choice really as this means accellerated progress in terms of making the organization lean and mean, of which the factory is already I surmise.
ivo 71 said on September 22, 2011
Yes, Dannii, I was already aware of the origin of the word as such. But what intrigues me is that the words ‘luipaard’ (Dutch), ‘luiperd’(Afrikaans) and even ‘luiaard’ (Dutch and Afrikaans) all contain the component ‘lui’. And lui in Dutch (and Afrikaans as well, I presume, given the ‘luiaard’) stands for ‘lazy’. There are other words with ‘lui’ in it where the ‘lui-’ stands for lazy, such as ‘luiwammes’. Now, in ‘luiaard’ it is, of course, quite logical, after all that’s one seriously lazy animal (or person, figuratively) but why is it also present in the term for the fastest land animal? Or is there another historical meaning available for the component ‘lui’? That’s the/my question.
But, however interesting this discussion may be from a philological point of view, I guess we are somewhat straying from what a Saab blog should be about…
Ivo
Lee said on September 22, 2011
Actually, in American New EnglandSpeak it’s uncomfortably close to “cheater”.
900SE said on September 22, 2011
I really hope this cost saving business won’t affect the general quality of the cars.
exsaab said on September 22, 2011
Operation DRM (Down the Road Mubbling) would have been more in keeping. Rather ironical that after the loyal support from the workers over the past 2 years that some of them will end up getting the boot!
Hans H said on September 22, 2011
“Mubbling” ??
Talladegan said on September 22, 2011
Yes what is ‘mubbling’ please?
terry9000k said on September 22, 2011
.
MUBBLING in English…..is:
When someone has something on their mind and talks to themselves, quitely, but loudly enough for others to hear a sort of rumbling noise = Muttering….
hope you understand this…
terry9000k said on September 22, 2011
see below
ivo 71 said on September 23, 2011
The official definition (from Urban Dictionary) of mubble: Ongoing, incoherent speech. A mixture of a ‘Mumble’ and a ‘Babble’. Usually performed when intoxicated or under the influence of alcohol.
Some people even practise it here. The ongoing, incoherent part. Don’t know about the intoxication, though.
Ivo
den said on September 22, 2011
don’t make it desaster, ex workers will get unemployment allocation, i’m sure that saab can win the challenge, production will start and ex workers will join again their positions
DUTCH900C said on September 22, 2011
It’s really sad that (some) people have to leave, but be honest: Isn’t that mostly by reorganisations?
I just think about the reorganisations by Chrysler and GM, to stay by the automotiveindustry. Yes, also GM, when they had to start the “new” GM, after the bankruption not so long ago.
Katsura said on September 22, 2011
The operation is already supposed to be very lean, where more can they cut? The Canteen catering ladies (I hope not). If indeed those engineers who stuck with the company through thick and thin instead of flocking to Volvo gets the chop it would be a sad state of affair.
Procyon said on September 22, 2011
There’s a bitter irony that several posts ago we all thanked Saab employees for staying with the company, and now some of them are going to be fired.
Khrisdk said on September 22, 2011
Let’s just wait and see how many, where and why.
Somehow I think it will hit hardest in those departments that suffers the most from “GM-disease” and as such did have a part in the current problems.
No offense to anyone, but I think a bit of GM-Ghost lived on
Grumpy said on September 22, 2011
A bit is good Khrisdk, quite a bit I think.
A critical, I mean really critical review is necessary to get back to the style that actually fits with the brand and most of the people working there.
mike saunders said on September 22, 2011
hmmmm….didn’t GM trim the workforce when it took over in 2000? And didn’t GM trim before that when it closed the ridiculous Malmo plant?
(and isn’t GM currently profitable, in part because it ditched money-losing operations like Saab?)
Continually blaming GM for the current state of the company is like blaming your kindergarten teacher because you flunked college calculus.
Grumpy said on September 22, 2011
Well Mike, blaming GM and saying that Saab is still working as if it was part of GM is not really the same thing is it.
I do believe that GM could have done a bit more to help Saab instead of starting a closure and there are probably plenty of reasons for Saab to be resentful towards the old parent. However, the way Saab choses to operate is up to Saab and not GM. And I don’t think kwe were blaming GM for that.
Khrisdk said on September 22, 2011
This was not meant as a blame on GM.
The reference to GM was made to make the point that I think that some forgot that they were not part of GM anymore.
Emil said on September 22, 2011
In keeping with our aircraft heritage, I think we should have codenamed the operation “Peregrine [Falcon]” instead, as it is TRULY the fastest animal, and also: it flies. While a cheetah can sprint at motorway speeds, a peregrine falcon typically exceeds 300 km/h during dives
jond said on September 22, 2011
+1
dave said on September 22, 2011
I wish the best of luck to the employees, particularly those who will have to find another job.
WooDz said on September 22, 2011
I’m sure there are a handful of workers who will gladly take a redundancy. As for the re-organisation; this should have been done months ago when supply stopped and short-term funding was exhausted. Instead SAAB spent 3 months diluting the company, whilst Pang Da and Youngman talked a lot but didn’t actually submit an application to the NDRC. IIRC Chinese investment should have happened in September according to first reports, oddly now it’s November. In the meantime we now hear of a the successor to the 9-3 arriving in 2013 and not Autumn 2012.
Personally It would be in SAAB’s best interest to accept a ‘soft-launch’ of the 9-5 Sport-Combi. Get production running again and get that new car to market early next year. Whatever state the car is in now… launch it!
Whatever is not yet available, add it to the 2014 MY vehicle.
jond said on September 22, 2011
To quote Charles Dickens ‘Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.’ – The Pickwick Papers.
This is the last chance that the independent Saab will have to show that manufacturing in Sweden can be profitable. If it can do that then, Chinese or no, the reconstruction will have been a success and Saab will survive. If it cannot and the Chinese withdraw – end of story. If it cannot and the Chinese come on board – they will probably move manufacturing to China.
The Company clearly has no choice. It must demonstrate very rapidly that steps have been taken to make manufacturing profitable on a realistic estimate of near-term demand. In fact it would probably be best were they to significantly overdo it, i.e. take a worst case scenario for demand. That is the only way to restore confidence in suppliers and potential customers. Less than that will be seen as weakness.
Everything that is not absolutely essential to make manufacturing profitable in the short run must go. There must be no half measures. Those laid off may be assured that they will be first in line to be offered employment when demand grows to support it. But in the meantime it is not the Company’s job to support redundant auto workers in Western Sweden. That is the job of the State.
It is the Company’s job to ensure that automobile manufacturing is profitable That is the only strategy for survival.
skwdenyer said on September 22, 2011
With respect, no, the Company’s job is to ensure that the Company is profitable.
Saab has already made steps towards selling services to third parties. That can continue and grow, especially now that there are new unconventional entrants into the marketplace (Fisker, for instance, or Tesla, endless sports car manufacturers, Russian and Chinese manufacturers, and others). Saab’s experience in testing and engineering, its facilities, its access to harsh Northern European climes, and so on are all marketable.
It is quite possible for Saab to generate very large profits from those operations, just as Porsche, Lotus and others have done over the years.
jond said on September 22, 2011
Quite right! I stand corrected (not enough detail). If it can be shown to be an integral part of a sufficiently profit-making operation then of course keep it. If not, then it should go straight to the recycle bin.
This will be dreadfully sad for all the staff affected. I am empathetic to the point that I shy away from even thinking about it, but it must be done.
Phoenix said on September 22, 2011
What surprise me is that I thought this job already was done. Over a year ago they talked about lowering break even. Why hasn’t this job been done already since Saab has been bleeding all the time? Saab is not a place you should be at just because there isn’t anywhere else to go. It is a business and must be lean and healthy. Often the most competent workers leave first becuase they have no trouble getting a new job. I hope they still have the critical mass of good engineers left in the company.
JST1981 said on September 22, 2011
Rome was not build in a day. The carving out of GM has left many restrictions and contracts we all don’t no about. That’s why some important steps to make the company profitable simply coulsn’t be made. Reorganization is now a great chance to cut those ties. I think that efficiency programs will speed up now. First priority is to start production, second priority is to get rid of obstacles that might block the outcomes, third priorty is to tell the people that Saab is alive, fourth priority encourage the dealers to put Saab back to live as well. I hope that even in this reorganization and cost-cutting times the management and of course Guy Lofalk realize that it’s not all about costs….it’s about reanimating the Saab brand. Therefore money will be needed!
Phoenix said on September 22, 2011
You are right that it is not all about cost. It is the relationship between income and cost that is interresting. And yes money is the key point here. A lot of it.
James said on September 22, 2011
While it is unfortunate for workers to be let go, the reality is, since GM let go of SAAB, SAAB is a startup… that invariably means volatility for workers – they can’t try and run the operation like it ran under GM, even as a slimmed down GM.
As others said, there are usually a few who want to pursue other careers (or retirement?), and a layoff package helps in that regard. This is different than being fired.
Hopefully the core R+D will not be overly impacted, as that is critical to the future for SAAB. I am amazed wrt how much R+D has produced over the past couple years in spite of all the turmoil + lack of money! Let’s hope they can keep that up… it’s one of SAAB’s biggest assets going forward + SAAB can not afford to have a brain drain on top of everything else… imho…
James…
mrrun2fast said on September 22, 2011
I’m really curious of how they will increase their efficiencies and reduce OH. I work as an OE consultant in a multinational company and this task is not simple. Will they spend CAPEX on equipment to reduce labor for their line? I’m willing to bet most of the reduction in labor will occur in the white collar workforce. Of course they could choose to outsource more production, which will reduce their fixed OH. This will be tough times ahead for the Saab workers.
Cerulean said on September 22, 2011
If I’m reading this right these efficiency measures will not be decided on until the end of October, to be then implemented before the year end. I assume then that production is probably out for the rest of the year.
As a Saab salesperson this would be bad news. We need production soon, as there is only so long we can survive on used cars, and frankly I am fed up with having to constantly inform/reassure our customers that cars and parts will be available once again.
I have had the opportunity to jump ship but have resisted so far. I can’t be the only Saab salesperson feeling this way.
Turbine said on September 22, 2011
Cerulean – I can only AGREE with you on this one. I do hope that getting PRODUCTION started asap is the main focus and not cutting medium to long term costs ! Yes everything needs to be efficient but a car company NOT making cars is simply not a car company! Hopefuly under restructure suppliers are willing to make and ship parts and saab cars can be shipped to dealers who quite frankly have been near breaking point for the last 6 months. Feel for all you sales execs out there – the market is real tough in retail at the moment and you need something to Sell – ! I only hope you do not have to wait until chinese monies in November – that could prove too long . Fingers crossed for you Cerulean – and all your colleagues within the brand,… hold on in there !
GerritN said on September 22, 2011
OK, my two cents on this. Outlining this reorganization will take a lot of time. If you want to trim each bit of fat of an already lean company then that will take a lot of research and documentation to make sure you’re not endangering efficiency. Normally these reorganization delays would be bad for a company because it would sink into even further debt. In Saabs case just a stay of execution is desperately needed to give Pangda and Youngman the time to get NDRC approval. Saab will probably use as much delay tactics as possible because after Pangda and Youngman are on board it is going to be a totally different game with no real need for reorganization anymore. Trying desperately to save 15% on expenses after the NDRC approval would be a waste of time, time that would be better spend on producing and selling cars.
sportwagon28t said on September 22, 2011
Its very sad when you have to cut the workforce down especially when they have been so loyal to Saab over the past months.
That said Saab does need to be more efficient so the first job to go should be the person that got Saab into this mess in the first place VICTOR MULLER
And before the VM fan club starts to post rubbish like ‘ it was because of Victor Saab is saved’ well i would say its because of Victor that Saab nearly died.
And dont bother blaming GM, the euro money fund, sweedish goverment , father Christmas etc etc because when a company is being forced into bankrupcy the buck stops with one person and one person alone.
hilmar said on September 22, 2011
???
skwdenyer said on September 22, 2011
I’m no fan of Victor’s. I thought he was made to take on Saab in the first place.
But, on reflection, and having run businesses for many years, I genuinely don’t see what else he could have done. I don’t believe he engineered this situation, either by intent or by omission.
The only thing he could have done to guarantee that this situation didn’t happen the way it did was to have walked-away from the GM deal when it dragged on and GM started shutting down Saab. He could have done that, just as CvK walked away.
The best management in the world won’t save every situation, despite what many might hope.
jond said on September 22, 2011
Surely it was a dreadful mistake not to cut back sharply on overheads about a year ago when it was quite obvious that demand was falling well short of the original business plan assumptions? That would have been difficult, but action of that type would have shown evidence of a strong and agile management and given confidence to both suppliers and customers. It would also have substantially reduced the more than half-a-billion Euro of losses that were incurred over the first eighteen months and offered an even chance that production would not have been halted. Also, the management seemed to be completely dumbfounded when they ran into problems with the suppliers. How come?
But, perhaps it would be better to look optimistically to the future than recriminate about the past. We are where we are.
skwdenyer said on September 23, 2011
I agree to a great extent. But what I’m not sure about are the Swedish rules on redundancy. The workers have to be given at least 3 months’ notice, if I understand it correctly. How much must they also be paid-off? I do wonder if, by the time the need was there, the ability to do it (financially) had vanished – just not enough cashflow to pay off those workers?
Red J said on September 22, 2011
sportwagon,
he wants to pass the sceptre to a more capable person, he has stated so in many times. But you can’t attract interesting people if the future of the company is not certain.
hilmar said on September 22, 2011
IMHO the number of cars they actually are able to sell per annum will be decisive. Better start with a small number which could be realistic than to expect too much. If the plant runs stable you can expand. People often drive their Saab for a long time, they are very durable.
GerritN said on September 22, 2011
The most important ingredient is how many cars Saab will manage to sell in China. Saabs traditional markets will need a couple of years to recover from both the recession and the tarnished brand name.
hilmar said on September 22, 2011
Unfortunately you seem to be right.
terry9000k said on September 22, 2011
.
Operation cheetah…..
Is the management cutting down too..
VM’s [via Swan] high management feeswill certainly be out now…value or no value, their gone.
skwdenyer said on September 23, 2011
Since they haven’t been paid, is this not really irrelevant?