The following is a Googletrans of an article written by Genii/Ecclestone co-ordinator, Lars Carlstrom. It appears online at Dagens Industri.
Any translation tips would be most welcome…..
Sweden betraying Saab
The conditions for Saab have never been better. Yet it has been impossible to attract Swedish investors. They have taken on a negative and totally incorrect analysis, writes Lars Carlström, spokesperson for Genii.
Already in early 2009 pouring negative formulations of Saab Automobile from Swedish media. A media meltdown began, value-charged words like “finito” and “kaputt” flourished freely.
The values and facts that these pundits have based their statements on is hard to say. The most common claim, that Saab has been making losses in 20 years, were highlighted. Let us analyze what lies behind these:
An integrated Saab in GM was to optimize the GM’s performance – not Saab. It is considered to be amateurish to draw an equation between Saab Automobile AB’s results and performance of Saab’s entire global operations because a large proportion of consolidated revenues directly into the GM rather than the Saab.
Saab Automobile AB’s performance is a major component of the allocation and transfer pricing. Saab can not affect currency fluctuations as hedging, materials, production, sales geography and more centrally controlled within GM.
The purpose of this has again been optimizing GM’s results. Dependence on foreign exchange rates, primarily the euro, pound and dollar, has knocked Saab.
Production development plan, which also is controlled centrally, provides long life cycles in which the benefits of newer cars can not be realized. Saab outgoing 9-5-model is now 12.5 years old.
In a large multinational company like GM optimize the performance of the group and not individual units or brands. Nobody knows about Cadillac, GMC, Chevrolet has made money through history.
The loan from European Investment Bank, EIB, has been a hot topic over the last year. The debate has been whether the state should step in and prop Saab with warranties or not. Opinions have been many.
However, the government decided to provide guarantees to the EIB for Saab. The risk of the state is very low because the State has pledges throughout the Saab. These burdens are mainly valued at scrap value. Assets far exceeding the 400 million euros, just over 4 billion, as the warranty covers.
All this should be remembered that this is a loan to be repaid. Market interest rate payable on EIB loan during its seven-year maturity. Saab is in the entire state duration of the guarantee to pay a premium to the State.
Furthermore, Saab will pay all state and EIB advisers. Likewise, Saab will pay for the personnel of the National Debt Office dealing with the matter.
This should be weighed against the imputed cost of unemployment, lost tax revenues and the destruction of Trollhättan with disastrous effects for the entire western Sweden.
Saab has today one of Europe’s most modern and most efficient car plants. Saab has two completely newly developed models, 9-5 and 9-4X. The company is debt free.
The prerequisites for Saab has never been better – with a business plan that has very good opportunities to make Saab into a leading automotive company in its niche. It is therefore difficult to understand how something so positive has been able to become so negative in the Swedish media. The analysis has been non-existent and has been based on cutting the Spirit rather than facts.
This whole downward spiral has led to almost have been impossible to attract investors to the Swedish Saab. Investors have taken on the medial and wholly inaccurate analysis has flourished.
Are we in Sweden, the world’s least nationalistic people?
Coordinator, Genii-Ecclestone consortium and a host of other initiatives for Saab