The Swedish government have helped Saab to the extent that the law requires them to help. They provided assistance with wages whilst Saab was in reorganisation. They have also provided research and development assistance to Saab, and many other companies, in the interests of growing Swedish industrial know-how. Many governments do this, so it’s not all that unusual.
It’s becoming increasingly clear, however, that the Swedish government will not provide assistance for Saab in the form of a loan that will assist them in getting through the next few years.
The Koenigsegg Group say they would like to find another 3billion Swedish crowns to finance Saab’s operations.
It’s not clear to me whether they need this to finance the purchase of Saab from GM, or whether it’s what they want in order to run Saab the way they want to. It seems this money is what they need to achieve the business plan they’ve presented to GM as part of the purchase process. GM have agreed to fund part of the plan. Koenigsegg Group are said to be putting in around 700mil SEK themselves and they seek to fund the remaining 30% via borrowings.
What remains as a matter for conjecture, then, is whether or not they should get it with assistance from the Swedish government.
We all know what’s happened in the US, where they stopped short of actually saying the Big 3 were too big to fail, but their actions implied it. France have helped out. Germany has a massive scrappage scheme. I’m pretty sure the Brits have stepped in, or at least offered to.
Even here in Australia we have had governments of various persuasions that propped up car companies over the years. Mitsubishi have enough lives for 10 cats before they finally pulled the pin a few years ago.
Because the jobs and the industries are important.
I’m not sure whether or not Saab will succeed in the long term. I’m quite confident they won’t go down wondering, though. I’m sure that if given the chance, they’ll build the absolute best cars they can design.
The other thing I’m not sure about is whether or not Saab have been bailed out at any time in their history. I know the Wallenbergs probably had to put money in a long time ago, and that they struggled to profit when under Scania’s umbrella, which led to their sale to GM.
But if they’ve never been bailed out by the government in the past, then what is so wrong about asking for government assistance this time? Saab are a vital part of a vital export and technology industry in Sweden.
What is so wrong with asking for a government loan (not a handout) to get a real chance at survival and independence?