Youngman’s plans for Saab in China [ChinaAutoWeb snippets]

Ivo 71 sent the crew a couple of interesting links. Thanks Ivo!

Youngman Lotus Wants 200,000-Unit Saab Capacity in Hangzhou. Albeit a bit old piece of news, but I believe we have not covered it in a posting yet.

According to Mr. Pang, an initial annual capacity of 160,000 Saab cars will be created here, which will eventual grow to 200,000 units; about half of the products will be sold overseas.

Most likely this concerns the Asian market only. Many Asian countries follow the same certifications as China, so a car produced and certified for China is an easy way into other Asian countries as well.

He also revealed Youngman first contacted Saab in October last year, and the two sides started negotiations in January this year, which led to the signing of a letter of intent in March.


In other news (also ChinaAutoWeb):
Hawtai Motor Chastised by CAAM for Grossly Inflating Sales Numbers.

Hawtai Motor, the unsuccessful pursuer of Saab, has been penalized by China Association of Automobile Manufacturers (CAAM) for posting fictitious sales, according to source close to the matter. In its May issue of Auto Production and Sales Report, CAAM put down “zero” for Hawtai sales as it deemed false and unusable the data from the company.

Is another executive round of the musical chair game afoot?

22 thoughts on “Youngman’s plans for Saab in China [ChinaAutoWeb snippets]”

  1. This is great news as it will only strengthen Saab. Most of the competition is building all over the world. This will solidify production in Sweden. As an example BMW has not been weakened in Munich by building in the USA, S. Africa, India or Austria.

    This puts our name on the road increasing notoriety.

  2. @Rune:

    Most likely this concerns the Asian market only. Many Asian countries follow the same certifications as China, so a car produced and certified for China is an easy way into other Asian countries as well.

    If Saab’s projected worldwide sales target was an optimistic 80,000, this is an awful lot of capacity for “the Asian market only.”

    And Peter and Red, huge Chinese tariffs on imported cars requires most manufacturers to partner with Chinese firms, or build plants in China. Those cars are destined for the Chinese domestic market.

    BMW hasn’t been weakened because it’s a quality manufacturer with high standards, regardless of where its plants are located. Currently no Chinese carmakers are capable of passing US or European crash tests (with the exception being Chinese cars built on platforms sourced by US/Euro manufacturers.) Their crash tests — even by their own loose standards — are a laughable joke. They supposedly adopted NCAP standards but even cars that passed their own “NCAP” tests failed Euro and US tests πŸ˜‰

    Maybe things have changed in the past couple of years. Maybe China is getting serious about safety.

    I’mm sorry, but Saab as we know it is dead. Period.

    • mike, as I recall, 80k is the breakeven point. I am pretty sure they’d want to sell at least as many cars as they did prior to 2008, especially now that they have got an awful lot of new product in the showroom.

      Youngman and Pang Da think they will be able to sell Saabs in China. If they are in this for the long haul, they’ll want to keep R&D in THN. In order to do that, the THN production facilities will have to remain. The facilities are very modern and it would be madness to shut it down.

      There will still be some rocky waters ahead, but lets keep the gloom and doom in check for now. I won’t, and obviously you neither, buy a Chinese car any time soon. I suspect Youngman’s executives know this already. Why bother with Saab in the first place if they did not know this?

      Besides, if killing off ‘old Saab’ is necessary for a ‘new and improved Saab’ to emerge, then so be it.

      • Rune, you make some good points, but no one operates a company to lose money, so the breakeven point is the baseline sales target. 80,000 was the stated target for most of the past year. So if they’ve suddenly partnered with a company that has the production capacity to double that amount, and if those partners have said that about 100,000 cars would likely be sold overseas…where are those cars going to go? Remember that the Asian market outside China is comparatively tiny…and VM has said that a $10,000 “Saab” might be a good idea for the world, regardless of the quality.

        So…If Trollhattan is primarily for R&D, then what’s the point of operating an expensive modern factory with expensive workers? A dedicated “halo car” factory? (That would actually make sense, as the car could warrant the higher premium over other Saabs…)

        • and VM has said that a $10,000 β€œSaab” might be a good idea for the world, regardless of the quality.

          The quote is wrong.

          with expensive workers

          Keep dreaming. european workers are not expensive because of the higher productivity and the lower quality problems.

          • So VM said a $10,000 made-in-China vehicle would sell. His actual quote is “Do you really worry about a five-star rating? They Look good.”

            You can decide who would actually make the car and what brand it would be sold under.

            And European workers are hugely expensive compared to Chinese workers. C’mon, Red. That’s a pure fact. And the Saab productivity only just nudged up to North American levels, and only after much prodding by GM. πŸ˜‰ Saab workers were notoriously unproductive for decades, which is one of the reasons why the company was in such ridiculous condition prior to the GM sale.

            But if you’re pushing the fewer quality problems angle, then that’s a tacit admission of inferior Chinese-made vehicles. πŸ˜‰

        • I don’t think last year matters much. They want to increase beyond the baseline quite a bit. What happened last year and this was a bit out of the ordinary and will hopefully not be representative of the numbers we will see in the coming years. The model range has been strengthened this summer, and will be strengthened again MY13. That, with an increased effort towards the dealers, should help fuel a rise in demand (and thus production).

          To worry that a future Chinese facility also will want to move beyond that baseline in order to fill up some new far-away markets seems a bit premature at this point.

          100k units is a low number for Saab in Europe and the US. So the numbers do not add up that way either.

          I cannot predict the future, and I suspect the same goes for you. We are both speculating on something that basically amounts to a rumour. Your speculation could as easily be applied to e.g. BMW as well.

          Besides, what are your options? If you are in the market for a car now, you can either buy a Saab produced in THN, or choose a different brand which I can almost certainly guarantee you was not produced in THN.

    • Saab as we know it?
      Can you describe it?
      Do you mean the pre-Scania Saab, the one building cars with the Italians, or the ones trying to build cars out of some GM non-premium platforms?
      To define Saab is not easy, as Saab has been moving forwards till the first day back in the 40’s. And believe me or not, Saab will continue changing.

      • I was going to say the same thing. ovloV must be dead now that they’re selling so well under new ownership? I don’t think their true identity was at its peak building more or less rebadged Fords either?

        The day Saab research leaves Sweden I’ll be the first one to declare the brand dead. But I bet the Chinese will never do it. It’s what they bought the company for.
        They want to have real SAABs to sell, unlike GM who desperately tried to make them just upscale Opels in order to feed some enthusiasts and people who wanted something different.
        Little did they know what THN was capable of even with limited resources.

        • Ford actually used the Volvo platforms in Fords and Mazdas, not the other way around. πŸ˜‰

          And Volvo wasn’t in the do-or die situation that Saab is in, and Volvos have much more of a reputation for safety to uphold. It’s a key part of their marketing strategy. So for them, Chinese-made Volvos escaping to Europe or the US was never an option.

          Little did they know what THN was capable of even with limited resources.

          Little did GM know? LOL….I think they hoped to get more productivity out of the plant, and to reverse the Malmo disaster. πŸ˜‰

          • Ford actually used the Volvo platforms in Fords and Mazdas, not the other way around.

            Not 100% right.
            The V70/Mondeo platform was indeed responsibility of Volvo, but Ford was responsible for the Focus platform ( C30, S40, V50, C70).

          • Not quite right.

            The Focus platform was derived from a joint Ford./Mazda/Volvo design effort, with much of the design expertise coming from Volvo…which had already started designing its C1 architecture.

          • So you’re a hard core ovloV guy πŸ˜‰ Have you ever driven a European Focus or a Mondeo. It looks and feels exactly the same as a V50. In fact all of them have horrible Ford interiors nowadays.

          • ” and Volvos have much more of a reputation for safety to uphold.”
            I don”t think that is correct. I dont’ think Saab is behind Volvo when it coms to safety.
            (For information; we also have a 2005 Volvo V70 D5 aut, but the next car will be a next generation 9-3.)

          • Audun, in the US, Volvo’s marketing hinged on its reputation for safety. In actual testing, Mercedes and Saab (and some GM cars, oddly enough) usually equal most Volvos in safety testing. That hasn’t stopped Volvo from making a big show of it.

          • @Mike: Then Saab shoulm make a big show of it too.
            Saabs new cars do it very well in the tests, and the handeling of the cars are exellent. The new Saabs are both fun to drive and safe. πŸ™‚

    • BMWs in China are built by Brilliance. Brilliance has poor safety record, but their BMWs are top-notch nonetheless. Same goes for every other joint-venture.

      It’s not like Saab’s gonna give them the specs and let them figure out the rest. It will essentially be a Saab plant with Saab QA and local workers.

      • You are right!!

        Sometimes people forget important sentences like this

        Saab Automobile will be responsible for….. and providing other necessary technical and quality control support.

        This text is from the announcement of the NPJV between Saab and Youngman.

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