PRESS-RELASE: Qingdao to become NEVS’ strategic gateway to China for Saab cars

NEVS has entered a long time partnership with the City of Qingdao in China’s Shandong-province. Qingdao initially invests SEK 2 billion, obtaining a 22 percent ownership share of NEVS through a directed share issue. Further investments will be made in a joint venture company in China. NEVS is headquartered in Trollhättan, Sweden where product development and manufacturing is located.

Qingdao’s investment in NEVS will be made in successive stages, and provides NEVS with a financially stable investor, as well as a business partner which provides access to a key market. The City of Qingdao has, through its investment company Qingdao Qingbo Investment Co, Ltd, signed a contract with NEVS’ parent company National Modern Energy Holdings Ltd. and with National Electric Vehicle Sweden AB (NEVS).

”This agreement provides financial resources that form an important contribution to enable implementation of the NEVS business plan,” said NEVS Chairman Karl-Erling Trogen.

”Qingdao is a long term strategic partner in China, which also provides us with a large customer,” said Kai Johan Jiang, CEO and main owner, NEVS.

”Vehicles based on new energy sources are the future. Qingdao wants to take an active part in this development,” said Zhang Xingi, Mayor of Qingdao.

Trollhättan is the NEVS headquarters, with product development and vehicle assembly. China is a key market with great potential demand for Saab vehicles. Qingdao is set to become the hub for NEVS’ efforts in the Chinese market, which means that exports will be shipped through the Port of Qingdao, strategically located on the Chinese East Coast. As production at the Trollhättan plant will reach capacity, a complementary manufacturing facility will gradually be established in Qingdao.

The municipality of Qingdao has a population of nine million, while close to 100 million people live in the Shandong province. The City och Qingdao is a large buyer of passenger cars, including both conventionally fuelled and electric vehicles. The NEVS investment is an important step to secure the region’s access to electric vehicles, and to build an industrial structure where the vehicle industry, including EVs, is key for the future.

As part of the agreement, a feasibility study is now conducted to guide the future partnership.

On August 31, 2012, NEVS acquired the main assets of the Saab Automobile bankruptcy estates, and currently studies the opportunity to commence production of the present Saab 9-3 model in the second half of 2013. The first electric vehicle model is planned for launch in early 2014. In October 2012, a sister company of NEVS in China opened a plant in Beijing producing high-performance batteries for automotive applications.

Nine
Member
3 years 8 months ago

In Saab world..the news is brought differently.–>.NEVS to build SAABs in China, later in Sweden
Check out..http://saabworld.net/content/nevs-build-saabs-china-955/
Or am I missing something here.

till72
Member
3 years 8 months ago

This is the official English version so it should be clear what is the case. Guess saabworld got confused a bit in translating the Swedish version.

Genrally china will produce for the local market, THN for Europe and NA.

Bravada from GMI
Member
3 years 8 months ago
It is actually my understanding that they say THN will produce cars for the entire world (seems like the cornerstone of NEVS’ plan is selling in the Chinese market, with any sales to Western markets being side business), with assembly and perhaps later full production capacity to be built in Qingdao over time. This, however, sounds too nice to be true – how long until the city of Qingdao will wait for actual return on their investment in terms of employment and technology transfer? What sense does it make to have a battery unit shipped accross the globe only then… Read more »
phermansson
Member
3 years 8 months ago

I think its not so much about getting a return on invested money but rather to create jobs and help further development of the region.

The Chinese understand something that we in Europe and America have forgotten, every industrial job that creates a products produces 4-8 service jobs. So for every industry job lost, one can in worst case count that as 10 jobs lost in the process. If Qingdao can bring major industry to their region, they can quickly develop into a very rich province…

Daniel B
Member
3 years 8 months ago

“The Chinese understand something that we in Europe and America have forgotten, every industrial job that creates a products produces 4-8 service jobs. So for every industry job lost, one can in worst case count that as 10 jobs lost in the process.”

-Amen to that Tim!
As an entrepreneur and employer in Sweden I´m actually starting to feel scared about how we seem to have forgotten that it is industry with production and export that makes a country to develop and prosper.

Carlo A
Member
3 years 8 months ago

I agree Daniel, the idea of a sole “service” economy is utopia … you need a balanced mix of innovation, service and manufacturing … you cannot only export “services”

Joel
Member
3 years 2 months ago

+1 (or “Like” in Facebook terms!!)

Bravada from GMI
Member
3 years 8 months ago

In a world where automobile manufacturing is under increasing competitive pressure and battling eroding margins, Saab has exit the sector while focusing on another growing business, which singing MoUs, forming alliances and capital tie-ups with various Chinese entities. “We’ve seen this business grow expotentially for Saab over the last two years” says a noted industry analyst.

*****

In all seriousness, I hope this bodes well for Saab. I’d rather see them sign something substantial with Fiat and AAM, but every little helps.

Timeshifter
Member
3 years 8 months ago

Especially AAM would be awesome… More new technologies…

xelav
Member
3 years 8 months ago

Sounds all too good to be true, but what else can we do than give them the benefit of the doubt. As Angelo mentioned a few times, now would be the time for nevs to start interesting people for their future products.

GerritN
Member
3 years 8 months ago
OK, let me throw somethings out here with the risk of getting tarred and feathered as a non-believer (again). Note: in the hope that someone proves me wrong….. There is nothing, nothing here or in previous press releases (official or not so so official) that indicates that NEVS will be selling Saabs anywhere else than in China. Also, the point where ‘the Trollhättan plant will reach capacity’ and production starts in China is a very fluid statement. Is capacity reached at 100,000 units/year, 50,000, 10,000? 100? I’m really afraid that the China lure of cheap production will quickly push the… Read more »
Simply9-5
Member
3 years 8 months ago

Pretty much this. They really haven’t given the West anything other than “we’re selling in China first” a thousand times. If anything, they would probably prefer not to sell in the West period. More of a hassle than just selling in a single market like China.

phermansson
Member
3 years 8 months ago
Well as it is right now, Chinese built cars can not be sold in the United States nor in Europe, partly due to trade-regulations but mostly due to crash-testing regulations. In a few years those crash-ratings will go up fast and chinese cars will probably have the same safety rating as Toyota and other Japanese cars, then stands the trade-rules. I doubt that the US government will ever let their market be flooded with cheap chinese cars, nor will the EU because it would absolutely kill the production in those regions of the world. Take a look at what happened… Read more »
Red J
Member
3 years 8 months ago

BMW announced in 2012 that they were thinking about selling China-build 5 series in the east-Asian/Australian market. I haven’t heard if they have already started or not, but I think the whole western car industry is also waiting to see if people outside China will buy a China build 5 series, like they buy a China build iPad.

phermansson
Member
3 years 8 months ago
Well you can not buy a US or EU built iPad… yet… But judging by Apples latest move in actually starting production of iMac’s in the US and people being more interesting in buying them because of patriotic feelings I would be very surprised if the car industry would go that far in the end. We will probably see import taxes go up in order to save domestic production jobs… That fact is already being by several member states in the EU for example, that all non-eu built cars would be come too expensive so that people would rather chose… Read more »
Angelo V.
Member
3 years 8 months ago

Tim: You’d be surprised how China holding trillions of dollars in U.S. debt might make it less cumbersome to have trade barriers lifted. I wouldn’t be so sure about made in China cars being kept out of the U.S. “Dumping” will not happen—but there is a very good chance we’re going to see Chinese cars come to the U.S.—–and if Saab is riding that wave, look out. They could be on the ground floor of something very profitable.

phermansson
Member
3 years 8 months ago

You know Angelo that the US economy is so bad that if the US wanted to defend Taiwan against China, they’d had to borrow money from China to do it. Exactly those words were said on Bloomberg this morning and that just proves you right in some way.

But I guarantee you that in order to protect jobs, the cars will receive such a high import tax that the chinese companies might just as well build those cars in the US, just like the japanese were forced to do 20 years ago…

Angelo V.
Member
3 years 8 months ago

I think there were other reasons for those plants being built in the U.S.—-not just import taxes. Yes, the current administration owes unions—-so they might try to protect jobs aggressively. But on the other hand—-they are internationalists/world order folks—-so it’s also possible China will prevail upon them, especially given how much of us they own—-to allow some cars into the U.S. It ought to be an interesting decade ahead of us.

Thylmuc
Member
3 years 8 months ago
While I am not an expert in this, I am rather sceptic regarding protective measures. That is what our states have signed all these international free trade contracts for (WTO). Only under certain conditions, states are still allowed to raise import taxes (price dumping e.g.). These agreements were made at a time when the rich made the products, and the poor could only, in return, deliver raw materials, like metals, oil etc. Later on, the deals were still beneficial for the Western countries, since they were able to get some cheap, simple products. Now, surprisingly (;-) ) it turns out… Read more »
JH
Member
3 years 8 months ago

@GerritN: In a TV interview when NEVS’ purchase of Saab’s bankruptcy estate was announced, I remember Kai Johan Jiang explicitly saying (in Swedish and maybe not literally but that’s what he meant):

“The factory in Trollhättan has a capacity of 200’000 cars per annum. We will do everything we can to utilize it.”

I can try to dig up the video if you’d like, but I don’t think it’s necessary since I remember clearly what he said. I also like what I heard and expect him to keep that promise.

Kimberly
Member
3 years 8 months ago

SAABs made in China?

Do not want.

Say whatever you want, but 117hp Fiat engines? Made in China? The SAAB we knew and love is finally dead – rigor mortis has definitely set in now.

Harriet
Member
3 years 8 months ago

totally agree – add to that no dealers in the US and I’m thinking the same thing.

Harriet
Member
3 years 8 months ago

I can’t even get a replacement brake light for my 2009 9.5!

phermansson
Member
3 years 8 months ago

Have you tried Neo Brothers or any other used car parts sales organization? I think they have lots of them…

If you’re waiting for a new one you might be waiting for a long time but used can be just as good!

gregory smith
Member
3 years 8 months ago

We have both in stock for you. . [email protected] Would be happy to ship to you!
Greg

Angelo V.
Member
3 years 8 months ago
The Saab that mattered has been dead for a long time. This is a chance for a rebirth that will take Saab back to their original intent—-and then some. There could be a dynamic change coming to the U.S. car market and if Saab is on that wave, they are going to be more successful than they were with the Saabs you’re referring to—-and they won’t go bankrupt either. Of course, all of this is speculative—-but the idea of Chinese factory capacity and FIAT being involved is just fine. Chrysler is certainly doing much better and is far more stable… Read more »
Aero1
Member
3 years 8 months ago

Chrysler was doing just fine, or should I say should have under CEREBUS’ ownership..multi $ billion owners who starved Chrysler from proper product and then finagled a bailout when they didn’t need or deserve it.. Granted Fiat or Marchionne actually is doing an awesome job, but to see a great American Company get given away.when it didn’t have to happen is criminal.

JH
Member
3 years 8 months ago

Given away? FIAT has paid hundreds of millions of dollars for their shares in Chrysler…

Angelo V.
Member
3 years 8 months ago
I didn’t think Chrysler’s balance sheets were “fine” in 2008/2009, but then again, I’m not an expert on the subject. But from a product standpoint—-they never had a compact car anywhere near as good as the new Dart (FIAT). I did like the PT Cruiser, but that was mishandled by the previous owners—-they had no idea how to make it desireable give it a longer life span in the marketplace. The “Sebring” became the 200. FIAT took the same basic car—-but on a shoestring budget, actually made it look nice, especially the interior. FIAT interior treatments have been fantastic for… Read more »
JH
Member
3 years 8 months ago
NEVS wouldn’t have bought the Trollhättan plant if they didn’t plan to utilize it, and they most definitely wouldn’t hire factory technicians in Trollhättan then – which they have already done! If you won’t buy a car from a manufacturer that has complementary production in China, you don’t have many brands to choose from… By the way, Saab has been using FIAT diesel engines for years and there is absolutely nothing wrong with them (maybe except that they should use timing chains instead of timing belts…) and no one has mentioned any 117 hp engines (which by the way would… Read more »
Thylmuc
Member
3 years 8 months ago

That is the second time you mention this Fiat engine. Why? I’d rather expect this:

http://www.alfaromeo.co.uk/uk/#/car-models/giulietta/engines/1750-tbi-235

Health
Member
3 years 8 months ago

I see no problem there at all. SAAB can put a nice turbo into this engine and extract some good horsepower. History repeats.

spacy
Guest
3 years 8 months ago

.
It makes me wonder what GM achieved by stopping Saab being part owned by the Chinese, as here s the IP transfer they tried so hard to stop.
Yes, I know no GM IP [or supposedly so] is included.

The fight we all put up, has ended in Saab being a eastern controlled maker.

jond
Member
3 years 8 months ago
However you view it, it looks as though the Chinese are absolutely determined to invest whatever it takes to make this one fly. IMHO this is really rather promising. It appears that we are going to see Swedish design and development matched with other Western technologies in cars that will most likely be competitively priced. Of course the requirements of China will take priority. He who pays the piper calls the tune. But the Chinese are unlikely to pass by the opportunity of expansion into Western markets, are they? Were they now to announce development of ICE power trains in… Read more »
Angelo V.
Member
3 years 8 months ago
I’m not sure how close other manufacturers are—-but could you imagine if Saab is among the first to sell Made in China cars in the U.S.? European brand awareness, Swedish safety (on at least the larger ones), Chinese pricing advantages? As I said earlier, this could be an incredible development if they use factory capacity in China for a less expensive (read smaller) model for western/U.S. export. People here may scoff at “Made In China” and complain about it—–but the fact is, they are buying. Large appliances $$$, computers/phones $$$—-it’s not just cheap toys and clothes from Wal-Mart—–China is providing… Read more »
JH
Member
3 years 8 months ago

Yeah, I concur that a smaller, less expensive model could mean a lot for the Saab brand in terms of sales and hence increased brand recognition and profitability. As long as that car is up to Saab quality standards it is good if they can utilize lower manufacturing costs in China for this model and keep the Trollhättan plant busy with the bigger and more expensive models.

scand
Member
3 years 8 months ago

Many other major car brands already make hundreds of thousands of cars in china ( eg, vw, audi, BMW, GM ).

For whatever reason, they are not exporting those cars to the west. It could be that they are running at capacity for the Chinese market, the quality of those cars, real or perceived, the fact that they have western domestic factories that are underutilized or politics.

It hasn’t stopped GM importing Korean made cars under a variety of brands though, from Chevy (spark and others) to the Buick encore.

No 9
Member
3 years 8 months ago

«As part of the agreement, a feasibility study is now conducted to guide the future partnership.»
Doesn’t that come before investing? I guess China is really different.

phermansson
Member
3 years 8 months ago

I was thinking exactly the same thing when I read it a couple of times and realized the word “future”. So they’ve done a business plan and feasibility study for the things they want to do in this agreement but they also leave room for even more, should this first step work. Which is pretty good I guess! =)

JH
Member
3 years 8 months ago

As far as I can tell, this agreement is still not finalized and the actual transaction should take place in a few weeks.

Seb
Member
3 years 8 months ago

Again,

Us SAAB enthusiasts are used to seeing these type of bizarro, incongruent press releases about SAAB ventures, etc. What I mean is something does not resonate correcty or seem right. Why would a Chinese company like NEVS build electric cars in an expensive EU country such as Sweden when it can do so cheaper in China?

Seb
Member
3 years 8 months ago

Meanwhile it took three months to obtain a bumper cover for my 06 SAAB 9-5. After three months the body shop was able to locate a used, heavily mucked up bumper cover which they had to completely refinish and it still does not look right…

Oh yes have no worries… There are plenty of parts available for our pre-Spyker SAAB vehicles… WRONG!!!!!!!

Thylmuc
Member
3 years 8 months ago

Where do you live?

Aero1
Member
3 years 8 months ago

Again I will not buy anything SAAB not built in Sweden.
I have nothing against the Chinese people, but know from first hand experience and the fact that my whole countries industry has died due to the dumping of cheap foreign goods and the fact that it is a one way street with fair trade. I would rather pay 3x more for something not made there.

JH
Member
3 years 8 months ago

Watch out if you ever buy a Saab 90, 95, 96, 99, OG900, 9000, NG900 Convertible, OG9-3 or NG9-3 Convertible. There’s quite a big “risk” it isn’t built in Sweden, but in Finland instead…

hans h
Member
3 years 8 months ago

But it must be said that Finland isn’t exactly a low wage country. That factory builds cars to a very high standard. Which is why they were also chosen to build Porsche Boxster and Fisker Karma.

And a Mexican built 9-4x is a real Saab, is it not?

But I understand what you mean, I really do. I have long wondered why it is always cheaper to buy from east asia. The transport must cost *something*. They are large ships, they cannot run for free, can they?
A city in Sweden (Lund?) has even bought stones for street laying from China. Stones!!!

JH
Member
3 years 8 months ago
He said “Again I will not buy anything SAAB not built in Sweden.” and that also excludes Finland, even if the cars are as good as those built in Sweden. I agree that it’s strange that we’re buying so much from China, and I’d prefer if more things were made in Sweden/Europe, but that doesn’t mean that things made in China are of inferior quality. Just look at Nokia’s phones for an example – my Nokia 808 is built in China and it has an amazing build quality and finish. If Saab can have complementary production in China to increase… Read more »
hans h
Member
3 years 8 months ago

No, you’re right. Chinese quality can be as good as western, or perhaps even better. As per your example.
And then sometimes you get things like my souvenir chinese olympiad clock bought in Beijing which only worked until you tried to wind it up again.
But there must be something wrong with the system when it is cheaper to buy something transported from east asia than something transported from within your own country.

Angelo V.
Member
3 years 8 months ago
Hans: In the U.S., the “something wrong” is big labor/labor unions.” As strongly as Aero feels about the far east “dumping” inexpensive goods and not exercising free trade—-I have a different take on it. I have a big issue with union workers on an assembly line, many without having paid for or taken out costly loans for higher education—making more per hour than I and my colleagues do. Having better medical benefits and platinum retirement plans—-and the cars being priced accordingly to pay for all of that—-putting American cars I like out of my reach. I will not support that… Read more »
3cyl
Member
3 years 8 months ago
Angelo, I am afraid that I have to disagree with you here. We have a union shop (I am not a union member) and it is not wages that is forcing us to abandon most of our production and become an importer. Rather, it is that the U.S. government applies mandates to U.S. manufacturers that are very costly relative to places like China. I am referring to things like environmental compliance, workplace safety, and required worker benefits. There is nothing inherently wrong with these things, but they cost a domestic manufacturer far more than the corresponding tariff on a competing… Read more »
Angelo V.
Member
3 years 8 months ago
3 cyl: Obviously, EPA mandates are crushing U.S. manufacturing—we all know that. This has been going on for decades now and I’ve experienced it first hand (factory that produced acid-etched brass Christmas ornaments losing out to Taiwan because the EPA made it impossible for them to be profitable—-each ornament would be more than anyone in their right mind would spend). Anyway, I don’t disagree with that observation and in fact, in my mind, yes there IS something wrong with that. But also—-statistically—-the American car companies legacy costs due to unions (retirement pensions, lifetime health insurance, platinum health insurance for active… Read more »
scand
Member
3 years 8 months ago
Angelo, I have no idea what you do for work, but the premis that any blue collar worker ‘should not earn more than you do’ or you won’t buy their product or service is a pretty myopic viewpoint if you ask me. Ford workers are high paid and unionized, yet ford makes affordable products that people want to buy, and it makes a profit, does it not? Your saab was made by unionized workers, with high salaries and very good benefits, as does every worker in Sweden get. Your Kia ( if that’s what you drive) got imported using extremely… Read more »
Angelo V.
Member
3 years 8 months ago
No, I didn’t say that and I think you missed my point. Plenty of blue collar workers earn more than I do and they deserve everything they get. Maybe I stated it incorrectly—-but my point is that I won’t go out of my way to buy an American car to “keep jobs in America” if there are cars I like just as much (or better) selling for less money. I will buy the car I like the best at the price I can afford—-and union workers, always ready for a strike/fight, can go pound sand. American products became lousy and… Read more »
Mark
Member
3 years 8 months ago
Is a Saab built in any other factory still a Saab? Well maybe yes and no. The Saabs built in Finland and Austria (including my own 1999 OG 9-3 SE HOT) were assembled using parts that were usually the same as those used in Swedish Saabs. The 9-4x whilst certainly more of a Saab than the 9-7x or 9-2x, used minimal parts that were common to Swedish Saabs (GM engines excluded) and was built in a Mexican GM factory. A Saab by proxy perhaps? Would a Chinese made Saab truly be a Saab? Well in some ways it probably depends… Read more »
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