Decision Week – Extended

It’s more or less quiet on the news front today. Time to take a breath and reflect a bit. Yesterday we featured the article from Automotive News China that stated that Saab is trying to get a loan of 600 million Euros from Youngman and that unnamed Chinese bank. It caused a lot of discussion in comments and views were quite contrary.

No matter how you look at it, the core in this idea of taking a convertible loan or/and issuing preferred convertible shares is trying to find a way to avoid the need for GM’s approval. I still think the plan itself could work out even though you stumble into the next questions about how GM would react and what NDRC would think of this. GM is pretty stubborn when it comes to protect their interests. They are neutral in an evil way, they don’t actively kill Saab but they don’t offer help either. In the end, you can’t even blame them because in today’s business world everybody is looking for his own favor. NDRC may let this go through if you can sell it to them as a long term investment, which it surely is. Even more, this would secure the investment already made.

So, what’s left now for Victor and Youngman is to find a way to get things done without the need for approval. Using preferred shares is not the only tool here, ownership change below 19,9 % should also be an option. Maybe even a combination of both. I’d even imagine that GM would be fine with such a scenario as their major demands would be met. Even if not, they had to fulfill their contracts with Saab as they are. But still, it would not be wise to burn all bridges to GM as there may be three or so years until the companies are fully divorced.

When I look at the interview Guy Lofalk did with di.se, he states that GM was not open for negotiations and did not say what they requested to let a deal go through. Well, GM said this before, total ownership change below 20 %. The reason that every proposal had a higher change is pretty clear – those who inject huge amounts of money want to get a certain share in the company. So they had to give it a try and hope for GM to ease its mind. Having a pure strategic investor on board taking over a certain share and keeping Youngman under the 20 % barrier could have worked. Noone wants to go into such a process on his minimum demands.

Lofalk blames GM for blocking all proposals and Youngman for not injecting the cash they promised. This statement lacks perspective. I already talked about GM, so let’s get to Youngman. They promised to put in money based on a MOU that is void by now and no additional has been signed up to now. Even if they wanted, I highly doubt that they can just put in the money without any agreement. On the other hand they are still at the table working hard on a solution. They seem to be very dedicated to this, unlike Pang Da who stated this week that they are still in but the fact that they are not in the latest proposals speaks for itself I think.

What I really miss in the interview is that he reflects on his role in this process. Given that he had to know about the ownership change clause in the contracts I still feel that supporting the 100 % takeover attempts by Geely and Youngman/Pang Da wa pretty foolish. He surely has no other choice than to end reconstruction in the current situation. This is not his fault. He has messed up things before. Not that he is responsible for the situation of Saab as it was when he took over. But as I see it he was not helpful either.

Meanwhile, as work goes on in Stockholm and elsewhere, all we can do is keep calm and carry on. It is very tough for Saab, but it is not over yet. I know that all involved will explore every possible option to pull this through. There is so much at stake, for Saab and also on a personal level for the involved parties, that everybody’s motivation can’t be any higher.

fuzzi
Member

600 mio is never enough as the total cumulated loss until today is about 760 mio !

Khrisdk
Member

Depends on how fast the suppliers and other wants their money, and what agreements are made.

How do you calculate the 760 Mio?

aop
Member

well, then let’s make it 760 mio loan , if you say so.
any other ideeas?
Serriously, they presented this in front of the creditors meeting and perhaps they thought a bit on how this money should be used.

Marque
Member

Thanks for the wise numbers but could you please name the source to it so that we can rest arrured it stands the proof of reality?

Tripod
Member
fuzzi, You are not talking about “clear and due debts” (i.e. to suppliers and some other), but something else. You are probably talking about all the current liabilities, apart from the long-term liabilities (2.6 billion SEK), mentioned in the balance sheet for June 2011, presented when they applied for voluntary reconstruction. Yes, they were said to be around 6.9 billion SEK, around 760 MEUR. Around 2.3 to suppliers etc. (accounts payable); 1.7 to “group companies”, and then some 550 MSEK, i.e. 0.55, “advance payments from customers”, (that ought to be for cars). That’s 4.55 billion SEK. Then there is another… Read more »
Tripod
Member

That said, no one has said that the mentioned 600 MEUR is supposed to be the only funds for years to come.

Mark
Member

GM is neither benevolent or malevolent. It just plain doesn’t care. It narrowly escaped the grim reaper itself recently. I don’t think it will be so lucky next time. One thing for sure, few in the Saab fraternity will shed any tears when that happens.

SpinM
Member
I tend to slightly disagree Markac. After all the hardship Saab had to put through because of GM and after all the proposals that GM decliend, I actually do believe Mr. Lofalk when he says GM would not accept any deal at all. By now I am preety much convinced they intentionally want to destroy Saab. In my opinion this is not just about GM’s current IP, it’s also about Phoenix and even more importantly about everything else that Saab engineers might develop for Youngman or any other Chinese or other car manufacturer that should inherit Saab through any institutional… Read more »
Tripod
Member
I would rather walk every day for the rest of my life than buying an American car; they are pretty much inferior to most things out there (maybe were good during the first half of the last century, but since then not much has happened), and if not in tech, then definitely in design, IMO. And this fine company, GM, seems to think, for some reason, that their soon to be old IP is of such a great value that they can’t let it live for 2-3 years in the hands of another company, or minority owner, via licenses. They… Read more »
derek
Member
I would rather walk every day for the rest of my life than buying an American car; they are pretty much inferior to most things out there It is easy to blame GM and have a bad opinion about American cars. However, I drive an American car. It is called a Saab. It shares common parts and design with some American cars. It is better, in several ways, than my previous Saabs. (OK, I hate the peeling rubber in the dash). When one buys a Honda made in the UK or US, they still think of it as a Japanese… Read more »
Red J
Member

derek,
there is a slightly difference between a Saab and a UK build Honda.

Saab is build and developed in Sweden or at least Europe, the Honda is developed in Japan but build in Europe.

Tripod
Member
I thought a bit about the wording before posting; I didn’t, and I don’t, want to hurt the feelings of American Saab enthusiasts, or car enthusiasts in general, or even Americans in general. 🙂 It was a bit harsh, yes. But that’s how I feel about their cars; they leave me cold. I haven’t complained about or belittled other brands before and there’s no need to as long as one’s favourite brand is around, unless one is a very odd personality. But now, during the last months, we have seen people jibing at Saab, here in Sweden. And now this,… Read more »
paddan
Member

Is December 15 still the day by which a solution has to be found, or is there a further extension of that date?

OH
Member

From TTela:

“It worked intensively on solving all the technical issues surrounding a new solution for Saab in Stockholm.
Victor Muller explained this morning for TTELA that nothing is finished, but seems optimistic….”

Negotiations in Stockholm, where Young’s Rachel Pang has participated and Victor Muller and other employees from Saab seems to be in a critical stage. When TTELA texting Victor Muller with the question whether there are any major news to tell from Stockholm, he replies “not as yet”, and adds a Smiley..”

aop
Member

“Negotiations…. seems to be in a critical stage.”
I don’t know how to read that.

Thylmuc
Member
Regardlesss of the outcome, it shows the problems in cooperations between a small and a big player. And by that, the fragile situation of Saab when relying on too many parts from suppliers that are also competitors. The same situation could theoretically arise with BMW. Would they allow their engines to be used in any Phoenix based car? And what about Fiat or Ford as alternative suppliers, in particular for Diesel engines? VM stated that his strategy was to outsource as many components as possible. While that sound reasonable, it leads to high dependency from others. the right mixture of… Read more »
Kimberly
Member
The same situation could theoretically arise with BMW. Would they allow their engines to be used in any Phoenix based car? That is a non-issue. SAAB is no threat to BMW and really hasn’t been, ever. SAAB may proclaim they compete against BMW and Audi, but with SAAB’s anemic powerplants and inferior interior materials, they compete only with BMW’s and Audi’s entry-level, lowest-trim models, and don’t even do so competitively when you consider SAAB’s MSRP vs. BMW’s and Audi’s MSRP. Now, many SAAB enthusiasts would say “Yeah, but SAABs do not sell at MSRP” but the truth is, car rags… Read more »
3cyl
Member

New SAAB buyers getting their cars for a “fantastic deal” (i.e. far below MSRP) is the problem. SAAB can’t make money at the prices its cars sell for. Buyers may be happy with their good fortune, but selling cars at a loss has not worked well for the fortunes of the Company.

Angelo V.
Member

Saab MSRP is inflated, at least in the U.S. For example, the current 9-5 is not a 50K car in the real world. It’s closer to a low 40’s price tag, which is where it would normally end up under normal circumstances. Most American cars and in recent years, Saabs (and some others) always start with an inflated MSRP and offer big discounts as an emotional/psychological component to selling. Meanwhile, many Japanese brands, BMW, etc., have a more realistic MSRP and tend to discount less.

3cyl
Member

It may not be a $50k car (unless you are willing to include a premium for owning something that is not as common as the competition), but it needs to sell near that if a profit is to be made.

RS
Member
The current 9-5 is not a 50k car? This sentence is something I have never understood. Does the car have just one fixed price?!!!!!! Last time I checked ‘the 9-5’s’ asking price was between 39k and 56k USD. An equally equipped 300 hp A6 was well over 60k. Don’t confuse the state of the company with what the product is worth (how much it costs to build). We’ve heard people who drive 80-90k Beamers say a 9-5 Aero V6 is competitive in terms of handling. Wait for that first snowstorm and a Saab is just about only thing that will… Read more »
3cyl
Member

Regardless of the MSRP for a particular trim level, SAAB can’t make money selling cars at steep discounts.

Angelo V.
Member
RS: I think when you consider everything—-powertrain, interior materials and switchgear, resale value, demand…a strong case could be made that the sticker price of a “loaded” Saab 9-5 is excessive. Guys—-I love my Saab too and no one has been more vocal about pushing for Saab to survive—but the fact of the matter is that anything in life is worth what someone is willing to pay. If year after year, Saab has to slash it’s MSRP to move inventory, it’s very clear that the MSRP is inflated—-that isn’t an opinion, it’s a fact—-it’s a market driven fact. The year I… Read more »
3cyl
Member

If by inflated you mean that sticker prices are high for what you get, that may be (or maybe not), but SAAB MSRPs are not inflated in the sense that they are higher than what SAAB needs to make a profit on the cars.

RS
Member
I’m fully aware of the problem of price competitiveness. You need to have a strong case to be able to ask over 50k. Is a new 9-5 worth the money absolutely -if you compare it to the Germans while DRIVING the car. To me it seems cars in the US are sold based on how they look on the inside on the showroom floor and what’s the 0-60 time. That’s when Saab’s in trouble. To say Saab had chased A and B for decades isn’t true IMHO. GM never let them build interiors and put in engines that could have… Read more »
Angelo V.
Member

Perhaps, a future plan could be higher volume smaller cars from China and higher end models from Sweden, all branded Saab—-or even the Chinese made Saabs branded differently but sold through Saab. In that regard, it would be somewhat similar to Toyota/Scion, but sold in the same showrooms. I think for survival, Saab needs to get more cars sold, more cars on the road—–meaning a good entry level offering. Grow from the bottom up.

OH
Member

“..or crucial stage”

Critical maybe sounds to negative

Kimberly
Member

. . . but honest

Petteri
Member

… or maybe: in a decisive phase.

Anyway, yet another F5 day. Really difficult to concentrate in work or anything else.

Usually I don’t do that much F5 but listen to P4 Väst to keep myself updated. Today, unfortunately, there was a fire in Uddevalla, some 40 kilometers from THN, and they sent their “Saab reporter” to report from the location.

Tripod
Member

“Really difficult to concentrate in work or anything else.”

Amen.

hans h
Member

Ditto !

kochje
Member
Let’s face this guys; it is as simple as it was stated yesterday; 1) GM protects its interests and is not really motivated to look into new options 2) So take an option that is not to be blessed by GM 3) that option is just to get a loan to restart production at Saab, with all consequences of paying the outstanding debts and salaries. 4) If that amount needs to be 600 M € or 750 M € is not the question; point is an investment needs to be made to frees Saab from a GM participation in this… Read more »
nichell
Guest

Make a deal with GM: give them piece of the pie.
In my humble opinion, YMPD should offer 51% or 81% of any profits made in the venture. OR:
Give them a royalty on every car sold. OR:
Pay them a yearly fee for their technology.
Make a deal with them, since they’re in the driver’s seat. gov’t motors is the bully boy.

kochje
Member

We should just take GM out of the drivers seat while there is just no time to go and drive again with a driver that does not know where to go.

liftarn
Member

Saab already pays for both licenses and parts, but obviously GM thinks the threat of competition is higher than what that income is worth.

aop
Member

A really nice article on the blog saabactu. Full of passion and Saab spirit.
In French:
http://saabactu.blogspot.com/2011/12/edito-nulla-tenaci-invia-est-via.html

Tripod
Member

Nice, I think I understood most of it via translations. Lots of spirit there, yes.

kochje
Member

Perfect article; I left a comment and asked to have this translated for our SaabsUnited site as well.

dickerin
Member

Can someone list GM’s major demands?

Tripod
Member

I don’t think so; they can’t themselves, it seems.

I guess grandma is allowed to buy some shares in Swan though, but one never knows.

TurboLover
Member

Grandma, but not her grandson who is a young man

hans h
Member

🙂

E
Member

If he hasn’t already, could VM “consult” Bob Lutz? That’s how this whole thing started two years ago. Now that Bob is retired, perhaps he could provide some insight into what it would take to get a deal done with GM …

per
Member

The next Saab modell should be named F5

saabtec
Member

That’s a good one!

scand
Member

or the Saab 600 – 6

talladegan
Member

How refreshing

OH
Member

TTela
“It worked intensively on solving all the technical issues surrounding a new solution for Saab in Stockholm.
– We are continuing, said Victor Muller to TTELA at 15:30 on Thursday….”

SAAB F5……. (Superb) =)

ivo 71
Member

Nope. That’s a Skoda. Not a bad car as a station wagon but definitely not a Saab.

😉

Ivo

Red J
Member

Not a bad car, but as interesting as a Toyota 8)

ivo 71
Member

The Toyota Soarer/Supra is not uninteresting.

:-))

Ivo

Red J
Member

The Supra?
It must be very interesting but I can’t remember which of the sportier Toyotas is the Supra.

ivo 71
Member

The biggest, fastest and baddest one.

Ivo

Red J
Member

I’ve googled a little bit, and yes memories come back to my mind, and although the car has a big engine, the looks are rather dull.
But, maybe it was a good car, but I can’t tell.

Khrisdk
Member

It’s a good car..xtremely good for high rev fun
But an one trick pony.

ivo 71
Member

Well, the last version -which was never or hardly ever sold outside of Japan- was quite exciting in its most powerful guise and easy to tune up to stellar power output. To be compared to the fastest Nissan Skylines/GTR. And the older Supras may seem dull today but at the time certainly weren’t 🙂 .

Ivo

Khrisdk
Member

I have had the no-so-much-fun experience of going up against one of them. RHD and all
That’s when I started contemplating a steg 5.
But I have the advantage of also being able to transport my family, fill up the trunk with Marshall stacks and hauling a 1600Kg caravan.

Greg Abbott
Member
It’s been obvious for several weeks, if not months, that this was the back-up plan if GM didn’t agree to the assorted ownership proposals. IMHO, the original 54 percent ownership proposal would have suffered the same fate. Victor, Youngman, and others had to know that a GM refusal to amend the change-of-control clauses was a real possibility – as a result I’m sure the current plan has been under discussion for awhile. It did not surface until now because Youngman would have strongly preferred the proposals GM just turned down. It was a bit of a poker game and GM… Read more »
Allan B
Member

Sounds like a good assessment, Greg.

I am just hoping that the storm in my part of the world tonight does not put me offline tomorrow in case there is good news. Are we expecting resolution any time between now and the 15th, is that right?

ivo 71
Member

Well, there is some GM IP content in Phoenix but probably not too much to make it impossible to make the platform wholly GM IP-free.

Love the ‘Youngman’s bluff’. Sounds like an avantgarde British movie 😉 .

Ivo

Quijote
Member

Is this even enough money to properly fund Saab over two years? I hope this is just the start of ever increasing financial contributions.

TukanSaab
Member
All I can say is Youngman better be pretty sure what they are getting in to!! So you have the Phoenix platform and a new 93….what is it facing? The new BMW F30 3 series, the new A4 (soon) and the refreshed C class. Not to mention the other competitors from Asia. The new 93 would have to be one AMAZING car!! Unlike the new 95 which got a decidely luke warm/negative reception from the automotive press, they need the kind of reviews the 9000 got when it came out. Moreover, to be completely divorced from GM is going to… Read more »
Irish Badger
Member

I have wondered about VM’s role in the company. While he should definitely be the CEO of Swan and any Spyker entity, Saab needs a professional automotive CEO or CEO wannabe (someone like Mark Fields at Ford – although there is not a hope in hell that he would take the gig). They should do a full and proper search for that person.

VM should probably remain on as Chairman of the Board.

ivo 71
Member

Well, that’s exactly what he wants to be. And was before JAJ decided to step down as CEO, forcing VM to put on the CEO’s shoes.

Ivo

michaelb
Member

A chairman of the board has the final responsibility for the whole operation, that strategies are correctly chosen, budget and financing are lined up, and supervision and controlling is there. If you have a financial “glitch” turning into a liquidity crisis paralyzing the entire organisation for 8-12 months, if you have a business plan and sales volumes worlds apart, and no precautionary financing being done in advance, all strategies, planning, supervision and controlling processes have completely failed. Would you make such a person chairman of the board in a normal company?
I would professionalize this function as well.

michaelb
Member

This is about money, a lot of other people’s money, not about personal ambitions, egos and vanities.

Khrisdk
Member

Frankly I would expect VM to leave the building as soon as he sees fit after a succesfull sale.
Unless someone asks him to stay

E
Member

I don’t remember the new 95 getting “a decidedly luke warm/negative reception from the automotive press” … as I recall the positive reviews were far more numerous than the negative. Far more. 😉

exsaab
Member

I can’t help thinking that SWAN should just be left to close down. Then get the administrator to sell the leftovers on to the Chinese who i am sure would be quite happy to start reproducing the classic 900 & 9000 range which surely must be Saab owned with all the tooling still available! Would do very well as a small niche car brand exporting a retro car, just like the vw beetle!

Keith
Member

Sigh. The VW Beetle is not based on decades-old tooling found in the back warehouse. It is a 2011 automobile.

The Saab name would not be part of bankruptcy assets. It is owned by Saab Aero, who likely would not further allow the Saab name to be used for autos. The drama of recent years has caused them brand name confusion, which I’ve read they would like to end.

The Phoenix platform would be a real asset in bankruptcy, but you’d have to call the car something else than a Saab.

hughw
Member

There’s all this talk about the Phoenix platform being free of GM IP. Is that really true? Some have said that certainly there are GM components on the platform that would have to be sourced from others, fair enough. But what about the platform as a whole integrated assembly? Is it clear that it was entirely developed post-GM without GM involvement or engineering? Or is it a hybrid where separating out the GM part of it would be essentially impossible?

Keith
Member

I’ve read (we don’t really know) that Phoenix contains “less than 10%” GM IP. How hard that is to replace – no idea.

TukanSaab
Member

I seem to recall that early on VM had made it clear that they were making a hybrid of the existing 93 platform with a statement like ” it is a good platform so why get rid of it”. I remember it being reported by Swade on this site. Given the 93 SS platform was 60% unique to Saab, I expect there is a bit of a game being played wherein they have modified Epsilon 1 further and added in stuff from ZF. Likely murky enough to make an IP claim on pre-existing IP more difficult.

saabdealer
Member

I’ve heard that Saab owns the Phoenix platform outright. Was development happening during GM’s ownership? I’m sure at some level but I believe GM has no rights to it after the sale to Spyker.
As for GM shared components, I’m sure there are. During the original sale, Saab and GM both stated technology sharing would continue for many years (~10 years).

Red J
Member

hugh, I think only Saab can answer this question, but from my experience, I doubt that the platform is bound to GM IP. On the other side, I think that the Next-gen 9-3 will source some parts from GM.
So putting it simple, the 9-6x, 9-7 and 9-2 that will be based on phoenix can be developed without GM parts.

But this is only my private view on things.

OH
Member

If Saab goes bankrupt,… companys waiting for it to happened to take over and continue making cars
sais Rolf Åsbjörnsson. to di.se

“Would the company still be called Saab Automobile if any of the stakeholders would buy the company at a bankruptcy?
“I do not say a word more,” says Rolf Åbjörnsson, who will not disclose any of the stakeholders is because he has “professional interest” on the issue….”

http://www.di.se

ivo 71
Member

Did a google on Rolf A.

Well, this is someone who, for once, may not be blowing the traditional DI hot air, seeing as he is a leading Swedish lawyer on reconstructions, insolvencies and bankruptcies with a law firm that seems to be Sweden’s best in the field of IP and technical licensing. A competitor of Guy Lofalks firm, in other words, but then perhaps one that does know how to move in situations such as Saab’s.

Ivo

Saabissimo
Member
Abjornsson and Lofalk have a personal beef that goes years back. In the small pond that is insolvency and restructuring in Sweden they are the two biggest fish – or among them at least, so they often find themselves at loggerheads whenever a large project like this is on the agenda. I believe they even worked for the same firm a while, years ago. Abjornsson obviously has good media contacts, because every time there is an issue related to his field, especially when Lofalk is involved, Abjornsson pops up in media with frequent comments. He has been in DI on… Read more »
hans h
Member

I am SO tired of Åbjörnsson and his theories. He *wants* bancrupcy. I am starting to wonder if he *needs* bancrucy.
He has “‘professional interest’ on the issue….”

Rolf Hägg
Guest

Quickly reading this article,it appears to me that the answer doesn’t live in China either.

http://www.chinadaily.com.cn/cndy/2011-12/06/content_14217296.htm

Again, hope and pray for a good outcome but it doesn’t look good.

Question, what happens to all of us holding warranties on new cars??? Does GM have any reason to honor those?

Keith
Member

First article I’ve seen with Chinese biz insight. It well explains why a deal is unlikely.

My understanding is Saabs through 2009 and those 2010 models produced by Saab when still a part of GM, still have GM honored warranties. Saab’s produced under Spyker/SWAN are a different story…

Khrisdk
Member

Oh maybe.
But the article is a rerun referring to the deal that was rejected by GM latest.

Red J
Member

The article is from the 6 of December, and it talks about the last attempt, and this is already history.

Keith
Member

It was interesting to see the insight from a Chinese auto analyst and a Chinese economist, as well as the Chairman of Pang Da. I don’t see how the passing of 48 hours would change their comments.

Khrisdk
Member

Hmm.–The article relates to wether or not BOC is involved and Pang Da is in negotiations.
Both has been denied, BOC by VM, and Pang Da is not mentioned in the press release, and GL has given up on his attempts, which in that case would be including Pang Da.
We actually discussed it in comments the day it was originally published, but you may have missed it.

Khrisdk
Member
Khrisdk
Member

Where the bank referred to is bank of China, not a Chinese bank

Red J
Member

Keith,
on Monday you were denying that SWAN had sent a new plan to GM, but this non-existing new plan was refused by GM on Tuesday.

I know you have trustworthy sources, but give us a break.

Come back on the 16th and tell us that “You know that this was going to happen”.

Keith
Member
I did have that conjecture, you’re right. And it certainly appears I was wrong. I owe you a bottle of Glogg. The amateurish PR leak job (a bank in china?) looked like merely a stall on GL’s bankruptcy clock. Perhaps it was a real proposal, but it wasn’t handled like one. Which at this 11th hour is a problem. Think of all the announcements of MOU’s / the money is coming / the suppliers will be paid soon / Spyker is sold to Coventry / no it isn’t / Spyker is sold to North Street Capital / lets just pretend… Read more »
Red J
Member
Keith, what you are telling me is what news outlets (this included) tell the world. Sometime (I’m still including SU) news outlets trust their sources and a very one sided view on things comes out, sometimes we try to give a broader view on one piece of news and people try to find a way to put this in a dark light. But this is only the level we (the people on the outside) communicates about those news. GM, GL, VM, YM, PD and SWAN communicates on a different level. The proposal from SWAN to GM on Friday wasn’t a… Read more »
ivo 71
Member

I’d start saving up, then. Red J has lots of friends. They all drive Saabs, BTW.

Ivo

Niklas G
Member

Nice formulation though:
“General Motors is not willing to hand over the technologies to Chinese rivals, because the US automaker has applied some of Saab’s technologies to its current locally produced models in China”

Khrisdk
Member

Yup,,I noted that on the first publishing too 😉

hilmar
Member

Interesting. So who (Saab!) really develops some technology for those American cars ? Shouldn´t be GM a bit more polite during negotiation because of this fact ? Perhaps GM could get a bit more of this excellent technology by helping Saab to carry on ?!

Khrisdk
Member

GM has a very large interest in Saab Powertrain.
The rest can go to H*ll as far as they are concerned.

Khrisdk
Member

They klike this little bit of the business:

http://www.saabengineering.com/

paulsaero
Member
We’re in a bad place Saab fans. It scares me that the company is looking for a 600m Euro loan, the capital payments alone will be 3500euro/car over two years assuming that sales hit 100000units/year from minute one. This isn’t hugely likely given that dealers are closing in Europe and the US, the logistics of getting cars from Sweden to China will prove expensive and add to the issues. I truly admire Victor, his fight is epic, I want – no need – him to show how the economics of this plan are going to work as I need surety… Read more »
Peter, Sweden
Member

Who says that the money has to be payed back in two years — and who says it has to be payed back [in money] at all?

And yep, fingers crossed for a happy outcome! It’d sure be about time…!

paulsaero
Member

Peter, quote from VM
AMSTERDAM — Saab Automobile AB is holding discussions with China’s Zhejiang Youngman Lotus Automobile and a Chinese bank over borrowing about 600 million euros (5 billion yuan) over two years, Saab CEO Victor Muller said Wednesday in a phone interview.

ivo 71
Member

If it materializes, it will most probably be a convertible loan. Meaning that the lender may opt for converting the debt into shares after a suitable period of maturity instead of getting the invested money plus interest back. I somehow suspect that this specific lender would go for a conversion. And that that maturity period may coincide with the GM IP rights becoming obsolete and, therefore, academic.

Ivo

saabyurk
Member

Doesn’t sound like a good time to get a Chinese bank to back a car company investment. From Automotive News China:
“As China’s air quality continues to deteriorate, a number of cities are considering tough limits on car sales that could trigger a major backlash. Last January, the municipality of Beijing imposed a monthly limit of 20,000 new car registrations, a draconian policy that reduced car sales by 70 percent. The central China city of Guiyang enacted a similar measure in July, and two southern cities, Guangzhou and Shenzhen, may follow suit. This could trigger an industry shakeout.”
Doesn’t sound promising. 🙁

Red J
Member

Saab will work under the radar. Which means, big sales for Saab are almost not noticed by the big ones, and therefore Saab will be able to sell in China, even unther those circumstances. Saab was not doing bad in Singapore although they have such a restriction.

ivo 71
Member

So, as a wealthy Chinese, you set up a company somewhere in the boonies, have it buy your cars and loan/lease/rent them to you. There are many ways to sail around restrictions like that, especially if you have money.

Ivo

Chris Hansel
Member

I like your thinking! Hope the Chinese are reading your post!

talladegan
Member

Sounds like a potential goldmine to a company which has core competencies in electric, turbocharging, rightsizing etc.

meccano
Member
Is GM the largest seller of cars in China OR is it that China is now GM’s largest market? One of the two. Points being – GM has a great deal a stake in China and they are experienced in doing business in China. I suspect that they had decided that another Chinese company can not have access to their IP and while they still protect their interests there. It would seem GM thinks, and would make common sense to believe, that if a Chinese entity buys Saab that is will begin production in China. No one really cared if… Read more »
aop
Member
davidgmills
Member

When GM, the EIB, the Swedish government, Pang Da and Youngman all file a motion with the court complaining about Lofalk’s interference and sabotage, then I will believe there is a good chance that Lofalk has acted with impropriety.

But until such a motion is filed, these complaints by Mueller and Swan sound very hollow.

henli1970
Member
I do not want to talk about the things what is going on behind the scenes between all the parties involved parties since I do not have a clue. The only thing that I wnat to express is what I feel as a fan, a customer an actually as a former employee. 1. Why am I a fan of the brand and why do I even feel that I could bring some insight to the SU community? Background: (sone time ago) I am brought up in a family which bought SAAB:s as far back as my parents could buy their… Read more »
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