Update on Situation from Just Auto

As usual, Simon Warburton of Just Auto has the best wrap up of events at Saab this week. There’s a lot of posturing going on behind the scenes on both sides, but all parties understand just how urgent the situation is. This could go any way at this point, and all we can do is wait. Hopefully this gives a little clarity on the situation. I advise everyone not to over analyze, all parties are trying to reach the best deal they can all agree upon.

Saab says the time limit on its potential Chinese investors’ memorandum of understanding (MoU) is concentrating minds as the automaker looks to convince former owners General Motors of its latest business plan.

GM poured cold water on a proposal by Chinese manufacturer Youngman and distributor Pang Da to assume 100% control of Saab, leading to intense negotiations this week between the parties to try and resolve the crisis.

It is believed Saab CEO Victor Muller is leading the talks from his home on the Mediterranean island of Majorca but the Swedish automaker has only until Tuesday, 15 November before the MoU runs out with almost no further options left.

“Time is a factor here of course,” a Saab spokeswoman in Sweden told just-auto. “The MoU as it is formally written now, is valid until 15 November and for many reasons it is in everybody’s interest to come to an agreement as soon as possible.

“It would be fair to say everyone feels the urgency of coming to an agreement”

The Swedish government told just-auto this morning it had raised the possibility of significant job losses should Saab go bankrupt with General Motors, with the US automaker continuing to talk to its former subsidiary.

“GM is definitely a part of the dialogue – I can’t characterise it more precisely than that,” said the Saab spokeswoman. “It is not as if everything is being discussed without GM.

“We are understanding GM’s position – we are looking for a structure that can be agreed upon. GM has some specific points they would like clarified.”

The Swedish government is anxiously eyeing huge job losses of up to 12,000 posts should Saab fail, including those in the supply chain.

The administration has stumped up three months’ wages for Saab employees as the automaker secured bankruptcy protection but that pot has now run its course.

It has also been in contact with China’s National Development and Reform Commission that has the final say on Chinese company investment.

15 thoughts on “Update on Situation from Just Auto”

  1. watch the douchebags at the truth about cars (forever inferior to jalopnik) take this article, spin it in a negative way, and run with it.

    napoleon complex in full effect over at TTAC.

    • I wish I could remember how to spell ” douchebag” because I’d use more often to describe some of the players involved in this mess.

  2. Obviously, GM has to find a good reason to collaborate in the survival of a competitor, albeit a customer also.. Wouldn’t the distribution force of Pang Da interest them for some of their products?

    • GM’s good there. They’ve already sold over 2,000,000 cars in China this year. That’s over 4 times the volume that Pang Da sold last year. Pang Da as a singular car sales entity does the most in China, but that doesn’t mean GM doesn’t already have a solid association of dealers.

      I get what you’re saying, but it’s just not that huge of a concern. The regions where Pang Da are strongest are already saturated by GM dealers.

  3. Guys it’s not about how many vehicles GM can sell. IT IS about how the Chinese do not honour any IP related issues or commitments. Once the IP is turned over to them they take it and exploit it in breach of all IP law. I for one, if I had developed IP and invested to do so, would never license or sell it to the Chinese without deciding first to never use the IP again. Once they have it, it will be exploited everywhere with impunity.

  4. The thing I find curious is the sudden hurry of the swedish government to protect 12000 jobs…but only now (and possibly to late), after VM was willing to step aside in order to save SAAB. Curious.

  5. GM:

    I do not understand what is really logical in GM’s behaviour, I mean now that they decided to get rid of Saab at the end of 2009.

    They sell 2 millions cars in China. They share technology with SAIC. They sold the Saab 9-3 technology to BAIC in sept 2009.

    And little Saab with baby Youngman and big smal Pang Da could be a threat for GM’s market in China?!

    I do NOT believe a word of that. So the question to me is : What do GM really want?

    They need to share/sell/lease their own technology to make more profit so as to research and developp new and really advanced technology. Keeping things in their hands will not make them richer in the middle term. So why not a joint venture with YLPD could not be forseable?

    Gouvernments :

    It looks like the sw. gouv. takes at last the consequences of a Saab’s bankruptacy. Too bad.

    On the other hand, if chinese gouv. (NDRC) do want Saab’s technology, if GM refusal could have consequences for them as well from the chinese gouv…

    More generally I feel disgusted by GM’s behaviour : the way they have been acting has always for business reasons of course (and understandable) but Saab is the best exemple of GM’s total lack of understanding their european brands and in fact lack of business acumen.

    GM is now killing Saab for the third time mostly through incompetence and lack of vision. And we are (still and still and still) supposed to wait and say amen? No way!

    • I think that most of you are very (very) naive about the analysis of the ownership of Saab.

      Yes legally speaking, Saab belongs to Swan.

      To my point of view, General Motors has never sold Saab.

      It is indeed very clear now that the 70 millions € that paied Spyker (Swan) was in fact just a right to get into Saab’s equity but certainly not the right to buy Saab’s production.

      GM non only poored Saab with keeping even the IP issued by Saab ingeeners research, they sold Saab 400 M$ but without any proper IP. What did Ford with Volvo-Geely? The same?

      Looking at this buy out with Spyker, it is obvious that:
      Saab has just been leased to Spyker : Saab’s IP was being kept in GM, GM kept 321 M$ of pref. shares in Saab, price (70M€) was just a right to enter, GM would oppose to every other buy out.

      Like I said, GM is killing Saab for the 3rd time.

  6. If GM is worried abt IP rights + competition maybe it should consider taking up an ownership in SAAB so it can both control and benefit.
    SAIC & BAIC poses the biggest threat right now as they are already using Saab technology in china and one of them is a GM partner.
    What I don’t understand is why GM stopped all Chinese & Russian companies to buy & invest in Saab from the very beginning. Maybe GM expansion in the east is so fundamental to the survival om GM that they been toying w Saab all along. So if GM once again can profit from Saab by selling parts, maybe GM can support SAAB and make a buck or to from it. I guess the Opel and Saic siblings wouldn’t like it to much. Looking at sales numbers maybe GM USA is no longer big daddy that calls the shots.

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