Mahindra in the “News”

A story has surfaced today about Mahindra and the possibility of them maybe changing their mind about placing a bid. I will stress that we do not know in any way if this is credible at all as the story comes from another un-named source to Di. I have never been a fan of this kind of reporting because we have no idea who is talking to Di, if they are credible at all or if they are just someone looking to stir things up and too often we have seen stories like this to not be fact at all.

Now Mahindra is considering withdrawing from the bidding. The company had hoped to take over one of GM’s licensing agreements for the purchase of Saab, but interpreters are now saying GM’s behavior is that they actively try to prevent the continued manufacture of Saab cars, writes Di.

Forgive me for the google translate but it seems to say that they want some licensing from GM for production and GM is not interested. As has been hinted for a long time now, this is no surprise to any of us. Normally I wouldn’t post anything like this because until you can name a source, I think it is just rumors and a waste of time but if we don’t at least give a point of view, we look like we are only interested in the good. Whenever GM’s name is brought up and the lack of wanting to have anything to do with licensing agreements and such, it really puzzles me that a company that went broke and was saved by tax payers can actually say “NO” to making money off of an agreement with another manufacturer. If it were my tax dollars, I would want them to do what ever they had to, to make more money and to pay back what is owed. Again, this may all be speculation and not even worth worrying about.

67 thoughts on “Mahindra in the “News””

    • That’s my thinking, the trouble is that this is out there and gets people talking for all the wrong reasons. We also have to remember that worse case, they are not the only eggs in the basket but I really have a hard time believing anything that is centered around an un-named source. If it is fact, a source would be out front and giving a company statement. As I said, I hate this stuff and would rather not even post about it but if it’s out there then we have to address it here rather then sending everyone an email response when they ask.

  1. GM: Boorish clowns. I’m an American taxpayer who is disgusted by the fact that they begged for a multi-billion dollar bailout—-but they continue to make horrific business decisions like the laughable Chevy Volt that is bleeding hundreds of millions in the red—-and turning down licensing money from these bidders. Clueless idiots that have cost my country billions—my seven year old and his kids will be paying our debt.

    • Nice said, Angelo; hope that there will be more US citizens with these feelings about GM.
      That company is still partially owned by the State so sooner or later their eyes must get open.

    • This is GM at its worst.The reason they failed in the first place was not knowing who their consumer base was and expanding too quickly in directions like Hummer and bankrupting the company trying to impress the Arnold Schwartzenegers and the corporate jet crowd and forgot who they were supposed to be building cars for.
      Then to fly in to DC ,hat in hand, and to be told the need to go out and come in again,not by corporate jet.They turned around and drove back in some hybrid SUV that no one could afford that took a support crew to get it all the way to DC from Detroit.Do not pass GO, Do not collect 300 billion dollars..Then they shed car companies like we do old email,Saab being one of them to the lowest bidder.They used that 250 million or whatever it was in fuel for the jets in six months.If you squint your eyes or imagine a Saab emblem on most of the new GM cars you can see why they don’t want Saab to succeed.They have stolen most of the design concepts and put them into their current models, particularly the body designs.They talk about technology licenses like they have invented anti-gravity or something.There is nothing GM has that hundreds of car companies around the world don’t have already.Hybrid cars are nothing new.Plenty of companies make better ones than GM.Tricky electronic dash and displays are nothing new.Look at a new Lexus or Ford for that matter.What licenses are they so worried about?
      My guess is they simply do not want and can’t handle the competition of a superior designed,forward looking car like Saab,especially made in China where they have gained a foothold in manufacturing ,much to the chagrin of Detroit workers after the “Bail Out” was supposed to bring Detroit manufacturing back from the brink.
      So Saab is just inconvenient to have out there with new designs and such a niche market that GM had hoped to fill with its stillborn Volt.They hope to get their shit together with their hybrid technology before someone like Mahindra or Mastsushita can breathe new life into the Saab hybrid program and Phoenix and leave GM in the dust.

      • Well said Hans!
        Did you watch the last time when D. Akerson was on Capitol Hill and how they praised GM for the innovation and engineering the Volt is supposed to be the pinnacle of…

        It’s interesting how scared the mighty GM is of Saab’s survival under a strong owner? It’s like there wouldn’t be any cars built in Germany. Does/did Saab have really THAT much potential. It’s mind boggling.

        • The Volt is already Obsolete and they know it.The batteries and charging system broke down almost immediately and the crash zone was vulnerable to battery leakage and fire.WTF?
          Is this the best they can Do?
          Should Mahindra/Matsushita get control of Saab the new Hybrid will assuredly be the first thing on the market and blow Volt’s doors off.GM Knows this and can’t come up with a viable hybrid “Green” car that fast.Therefore they will lose market share and wind up with egg on their face at the next shareholders meeting.Plus where’s the rest of our money from the Bail Out?They sold Saab since and no longer control it .Why do they have any say over a bankruptcy sale in a foreign country?What technology licenses?Batteries that won’t charge and burn up?Saab’s hybrid was the next phase of development and GM pushed hard to get them locked down before and such vehicle could ever come to market.Very transparent business ploy to destroy the competition.I’d like to see them try that move on BMW when they become partners in developing power plants and hybrid technology with the new owners of Saab ,whoever they may be.

      • “If you squint your eyes or imagine a Saab emblem on most of the new GM cars you can see why they don’t want Saab to succeed.”

        Shouldn’t that have said:

        “If you squint your eyes or imagine an Opel emblem on most of the new GM cars you can see why they don’t want Opel to succeed.”

        Except that Opel just cost them 300 million dollars in the fourth quarter of 2011.

        • Yeah, That too…It’s sad that like in all other aspects of artistic expression,automotive design is mostly a copy-cat medium in which the guys with the most money buy off the designers and
          lay claim to the latest trends.Opel is another example of a company ripped off and left for dead by the Big Brother GM.
          I think they buy these companies just to eliminate the competition, steal their design ideas,steal their customers and present them with some facsimile of what their original brand had to offer in a cheapened down form .Sad…

  2. This would be only reasonable for Mahindra to do if it is indeed the case.

    That said, I am pretty much appalled by how GM is handling this. I am also very disappointed that the Swedish government is not getting very vocal about it – that is, I am being disappointed with the Swedish governments lack of support for Saab on the whole and ever since. GM is still part-owned by the American government and is acting with extreme hostility and little business sense.

  3. If this is a true report, it could also mean GM won’t play ball with any other interested party. But what about the reports from BW? They have indicated a positive reception from GM in the past. Could it be GM just don’t want any involvement withe the Indians and the Chinese? Perhaps GM just don’t see the Turkish as a threat the way they see the Indians and the Chinese?
    Such stupidity on GM’s part!

    • Somehow BH talks to Turkish Media about GM very positively, we do not know what they depend on and yet we have no clue what GM thinks about Turkey. What we know is lately some BH officials visited GM in Detroit. I think if that meeting was a bad one, BH today would not be still in this game, since they want Saab as a whole.

  4. Best senario for me: Brightwell gets Saab ! and Youngman are investing in Brightwell! This way the Turks get the GM licenses to continue the entire Saab range, Youngman will open the chinese market to Saab (30.000 + units) and a Lotus will be produced in Trollhättan (more jobs and better rentability of the factory) 🙂
    What do you think of that?

  5. Am I the only one that believes this story is probably true? It should be clear to everyone at this point that GM is NOT going to do anything further. If Saab is able to continue it will be without any IP from GM. At this point it is almost certain that Saab will be split up.

    I certainly hope I’m wrong but you would be crazy not to at least acknowledge the rather large elephant in the room.

  6. If GM won’t license to Mahindra, I doubt they will license to anyone.

    If this is the case, then maybe the US government has much more say about what GM does than we are led to believe. The US government is not happy with either the Chinese or Indians at the moment, so who knows?

    Just hope this is an unfounded rumor.

    • I think the time has come to get real about this. There are two possibilities here – either GM agrees to help by supplying parts for a couple of years, or it does not.

      If GM will not play ball, then anyone buying SAAB must have pockets deep enough to fund operations and development for a couple of years, AND to then sell try to cars through a (by then) non-existent dealer network into a severely depleted market-place where the SAAB name was pretty much forgotten. This would be a truly massive and high-risk venture.

      So what is the probability that GM might play ball? To work this out we need to imagine ourselves as (God forbid) GM managers.

      If GM were to agree to supply parts for continued 9-3 production:

      1) it would be for only a couple of years
      2) these additional sales would make a pretty insignificant % addition to their bottom line during this time
      3) they would have facilitated the survival of a potentially potent future competitor

      Now, if I were that GM manager, I would have to take the view that the short term benefit of added (relatively trivial) parts sales was not worth the risk of a resurgent SAAB starting to eat into my sales. Most of the reputational damage of destroying SAAB has already been done, and in any case will be short-lived. It may not be short-lived amongst our community, but recognise that if everyone on the planet who had ever bought, driven, ridden in, or just touched, a SAAB, plus all their descendants in perpetuity, never bought another GM product, the impact on GM would be totally insignificant – they simply do not need to care.

      From the point of view of this GM manager, this really is a complete no-brainer.

      I am forced to the unwelcome conclusion that the game is up.

      • I cannot agree that Saab’s continued existence would create a greater threat to GM than Volvo, Audi, BMW et. al. continuing to exist. I don’t think Saabs have been and would have been cross-shopped against any GM cars present and future. They are completely different and so are the customer bases.

        By killing Saab, GM is sending more customers to Volvo, Audi, BMW et al., not getting a single penny out of it. And in a few years… now that’s eternity in the automotive industry. Especially for GM, who change their strategic plans completely every other quarter.

        And I don’t think any GM board cared for more than 3-4 years ahead, if they were particularly prescient. Most care mostly about the next quarter. And, for now, Akerson blew it big time with a drop in sales in a month when everybody gained, and managed to get GM below 20% again, and closer to Ford than before. So, Akerson could use some free cash in the kitty from restarting Saab – especially to help Opel, who now have to deal with reduced utilization of Kaiserslautern (by up to 1/2, I believe).

        There is some convulted logic in what GM is doing. But there is absolutely no business sense.

        • Agreed, that SAAB would not present a greater threat than Volvo, Audi, et al. The difference is that they are all there and competing, and there’s nothing much GM can do about that. But SAAB is out of the game and GM CAN do something to ensure that that continues to be the case. Even one fewer competitor is good! Especially if you are fundamentally flawed and insecure, which GM certainly is.

          Anyway, you’re welcome to come back in three months and show me that I’m wrong!!!

          • GM doesn’t understand what the Saab debacle does to their image. They come out as complete cowards that can’t take the competition from a small car manufacturer who would be happy with 0.5% worldwide market share. It’s not like THN was relying on GM tech…
            Opel sales is als greatly affected by the actions GM take on trying to wipe out the tiny Saab.
            The world is watching.

  7. I honestly don’t think the US government is in any way involved in helping GM decide how to respond to Saab’s potential buyers. That is all GM’s leadership. I can’t even imagine who in the US government would be involved. But I think it is probably true that GM has no interest or willingness to license IP to any new Saab owners. They have made that clear. Brightwell’s claims seem overly optimistic to me. I think the best any Saab buyers could hope for would be to buy parts for the 9-3 from GM, until new models can be developed. GM had offered that in the past and perhaps could be convinced to do so again. That, it seems to me, will be the only avenue to pursue that is not a deadend.

    • GM would have preferred to shut SAAB down rather than sell to Spyker. They seemed determined not to make the same “mistake” again.

    • SaabMan, how can you separate the two? Do you believe that GM management alone is pushing the Volt without pressure from the US government? It makes absolutely no business sense…and this is just one example.

      I think there’s no doubt that someone in Washington is pulling the strings when it comes to how GM is managed — and how they handle Saab’s licensing. With billions of dollars of government money (taxpayer money) at stake, they are not about to give an investor with deep pockets an opportunity to turn Saab around and become a competitor.

      • GM’s history of doing things that don’t make busness sense predates the US government bailout. This doesn’t mean you are wrong about a conspiracy, However, it is more likely that GM simply views SAAB as a persistent pimple that it wants to go away and that Washington is too busy seeking out weapons of mass destruction to worry about any threat from SAAB.

        • +1000

          GM has been irrational in the very same way not long ago when they were still resisting any government influence. But I do believe the influence government could exert can be used to force them to become more considerate with regard to Saab – which is why I accuse the Swedish government of gross negligence and sitting on their hands.

  8. I agree that GM (Government Motors) is NOT collaborating and has a magnum agenda that transcends anything this potential sale may bring. The US government is now in the business of giving corporations like GM and many major banks greater human rights that the actual human citizens of that nation. Saab’s survival would benefit the world to some degree and I would love to see it thrive. GM can go you know where.

  9. The only way GM will probably bend to a licensing request if it is backed by a national govt with carrots and sticks attached. I think the Swedish govt needs to assist here, but they seem to want to destory Trollhatten. Perhaps the city did not vote for the current incumbents?

    • Agree. While GM’s behavior has been objectionable, it is not exactly surprising . The behavior of the Swedish government on the other hand has been bizarre throughout this whole process. If the Sweedish government has been less than helpful, it is not surprising that GM has a less than altruistic attitude toward SAAB.

  10. The thing that gives me hope and makes me think BW might have a chance is that GM really really doesn’t want Saab in the Chinese’ hands. That means they are more inclined to “help” out BW if for no other reason than to keep YM from getting them because otherwise there is nothing GM can do to stop that from happening. Saab could also offer engineering services that GM needs in exchange for IP licenses.

  11. I fear that GM is actually talking to BW just to use time – and then time will force the administrators to sell Saab in pieces and GM can say they are not to blame… Off-course I hope this is not the truth, but it could be typically for GM…
    Seen in that light it might be better if YM gets Saab (soon!) because their plans are now excluding GM-rights…
    – Just some thoughts..

  12. Just my thoughts. Only the GM-free Saab will survive so one should hurry up to get a lasting deal with an investor supporting this issue and build up the car again on the phoenix platform. Unfortunately this will take time but I´ll wait for the new Saab …

    • If Mahindra was also looking to restart the production of GM-sourced models,

      The Swedish government clearly favours the annihilation of Saab Automobile AB, so there is not much hope left. The costs of effectively restarting the Saab brand are quite staggering, and with Spyker making a bad example, I don’t think there will be many willing to go down this road.

      Independent automakers don’t seem to have it easy those days:
      * Mitsubishi declared they will close NedCar, which is very depressing to me personally
      * Mazda can’t get out of debt
      * Fiat is losing sales in Europe en masse and only propped up by Chrysler

      This makes “analysts” and potential investors wary. OTOH, BMW, Mercedes and Audi are making a killing worldwide, and there are success stories of JLR and (only moderately) Volvo, but doesn’t it seem easier to simply buy a chunk of shares of any of those than to try to restart Saab, so badly damaged?

      I don’t think there is anybody on earth with billions to spare so intent on “saving” Saab – if there was anybody, they would have bought Saab out long ago.

      Oh btw – where were Youngman and Mahindra when GM was originally selling? Did Mahindra place an offer back then and were they turned down? Or were they too busy with Ssangyong?

      • Whoopsie, something ate the latter part of my first sentence for lunch:

        If Mahindra was also looking to restart the production of GM-sourced models, that means nobody is seriously interested in a plan where they fund Saab coasting along for two years in the hope the elusive Phoenix platform gets developed.

      • “but doesn’t it seem easier to simply buy a chunk of shares of any of those than to try to restart Saab”


        But… The riskiest investments often stand to reap the biggest rewards. Safe investments rarely offer much in dividends.

        Saab without those GM licenses is a gamble. But OTOH, if you want to become an automobile manufacturer, you do get access to a lot of R&D for a cheap price. Half of E-AAM e.g. — that is high tech stuff that takes years to research.

        I share your observations of SweGov. Their reluctance to offer even a little fragment of moral support is such that an investor (any investor) should think twice before putting their hand into that particular hornet’s nest. Had this been about Opel, Reich-chancellor Angela Merkel would be kicking in doors all over GM’s HQ and demand answers. SweGov OTOH merely sent a secretary of state several years ago to talk about the weather.

      • So I hope that there will be somewhere an adventurer with his treasure chest … otherwise the rest will end at Volvo. What a shame. One should really persuade Volvo to create the Phoenix-Saab – wishful thinking, I know.

        • If the Phoenix platform is anything but a pipe dream, then Volvo COULD perhaps use it to replace the Ford Focus C1 platform as used in the Ghent models (S40, V50, C30, C70), as they have already said they are looking for a partner to share architecture costs.

          There are some problems with that, as I understand the C1 and EUCD (Volvo S/V60, XC70, S80, Ford Mondeo, S-Max, Galaxy) platforms have been specifically developed with mutual component sharing in mind, and the Phoenix might have been designed to be much bigger, heavier and more expensive than Volvo needs, but then Volvo said they are looking for a partner and hired Mats Fagerhag…

  13. If GM wants to actively prevent _any_ Saabs to be built, they will probably succeed, since they can certainly put pressure on any core supplier that Saab might rely on. Irrespective of licences and IP. Magna has turned suspiciously quite lately.

  14. Well now where all are in a depressive mood, because of a rumor , tomorrow maybe something hopefull apears in the media, and we are all pressing our f5 button to soke up the latest manic positivity. So frustrating. Going for a Saab drive now in the snow. Yeah baby….

  15. Actually, I’ve been rather less depressed ever since the thread about Saab parts flowing to the UK, which means that all the Saabs on the road will be kept going and an active ‘servicing/repairs/used sales’ network will be adequately supported. So, whatever new cars are actually built, there will definitely be a Saab brand visible and supported probably for at least a decade and maybe rather longer. That is more than enough time for some party to get its act together and resurrect the brand in some fashion free of GM IP, whatever the outcome of the present bidding process.

    May I make a suggestion? Perhaps some of the Saab engineers who are presently unemployed/underemployed could get together and form some sort of loose organization (or for that matter a formal company involving equity) with the objective of designing a completely GM-free modern Saab. It might be fun and could be made to run concurrently with looking for permanent work. IMHO it would also stand every chance of being financed for a limited run, given the international network based on the existing cars, the fact that it would be a pure Saab and the strong brand reputation.

    Of course, the best outcome is that the bidding process yields a buyer who is willing to fund just such a vehicle up front but, even if it doesn’t, there is still oodles of potential for the brand.

  16. I think it’s important to understand the position GM are in.
    There are many reasons for why GM would not want to license IP.

    Option 1:
    It could be pure and simple; They do not want another manufacturer using their property regardless of brand or use. A point of absolute zero tolerance. GM could license IP with very restrictive usage but the message from GM running through the media is quite consistent.

    This leads me to believe they is more going on than meets the eye.

    Option 2:
    They fear a renewed SAAB with substantial backing would hold a threat to GM’s global operations, which adds fuel to why GM will not allow any buyer use their IP, even if just short term.

    However; I believe GM’s stance runs deeper than this.

    Option 3:
    OPEL has been in the news lately with rumours of factory closures, job losses to even GM looking to sell their loss-making European investment. It’s been suggested by various journalists that because GM is still owned in part by the US government, there is a lot of pressure on wanting GM to write black figures in everyone of their operations. There is a train of thought that the Government would rather drop all external operations and have GM concentrate purely on their 4 Core brands; Cadillac, Buick, Chevrolet and GMC where GM is now turning good profits.

    This leads me to believe that GM’s hands are being held by a body that is hell bent of getting their tax-money back asap. A government that is fully aware of a general public perception that is still skeptical of any continent that doesn’t have spoken English in a major political roll. Yes I do believe that the majority of Americans are still skeptical of Russia and China.

    Personally I do not know why any buyer would be interested in restarting production using GM IP. The money required to do this would be better placed in getting Phoenix to production faster.
    Get new suppliers, new parts and forget GM. GM have enough problems of their own which I believe will eventually end in bankruptcy. Any new buyer actually interested in reviving SAAB needs to look for new partners and new horizons.

    • Good post and I agree. I think what is going on with Opel has much to do with whether GM will abandon all overseas operations. Who would buy Opel? The Chinese? The Indians? The Russians? The Canadians? If GM wouldn’t sell Opel to the Chinese, the Indians, the Russians, or even the Canadians, do you think it would sell Saab to any of them?

      Opel is a much bigger headache for GM if Opel is not making any money. This is much bigger than Saab.

      But any new buyer who can not absolutely guarantee product to the US market in five or six months means Saab is dead here for a long, long, time. Maybe forever.

      • GM’s huge problems with Opel and Wall Street is going ballistic:

        [General Motors Co will report a loss of more than $300 million (for the fourth quarter) at its troubled Opel unit next week, as the U.S. automaker races to find cost cuts that can win the backing of its German union, people familiar with the situation said….

        Wall Street wants a fast restructuring to slash costs, while the German union, IG Metall, has refused to consider immediate plant closures or job losses….

        “If within the next six months there’s not demonstrable change at Opel, then investors are going to be asking serious questions about leadership,” Morgan Stanley analyst Adam Jonas said….

        Restoring Opel to profitability would address one of the biggest uncertainties left untouched by the Obama administration’s $50 billion taxpayer-funded bailout in 2009.]

        Makes GM’s problems with Saab seem trivial in comparison.

  17. The Swedish government has apparently fallen victim to the austerity bunch, who only see that workers should be enslaved and pay high taxes to pay off huge government debts to the rich. Too bad. I feel sorry for the Swedish people who used to have an admirably egalitarian society.

  18. I guess there are only two ways we can see Saab-branded cars being made in the future:

    1. Volvo decides to launch an all-new supermini, and uses the Saab brand for sentimental reasons, and because Volvo’s styling would look awful on a small car (as a matter of fact, the current styling looks awful on a vehicle of any size, but the C30 is particularly offensive with the new nose).

    2. BAIC takes over the majority of the bankruptcy estate in hope of establishing itself as an internationally-recognized automaker and catch up with SAIC. Fingers crossed for some healthy Beijing-Shanghai rivalry, although BAIC has been legendarily lethargic when it comes to accomplishing anything daring.

  19. I think Mahindra would be able to carry Saab into a bright future, free of GM.
    If they can keep Saab R&D together and work on the phoenix they should be able to launch 2 or 3 base models within 18 to 24 months. I know it sounds short, but remember that the phoenix is devolped as a modular platform to scania’s example. This should create opprtunities to develop 3 base models in parallel. They can “rent” Saab R&D to Ssangyong and gain some income. They can have an “engine source” through Ssangyong to build a “Saab” engine, and tune the Sangyong engines to gain money. They could partner with youngman to introduce Saab in China and/or build lotus cars for youngman in TN. They can use the Saab network to introduce Ssangyong and share costs. They can do a lot of stuff… but the fact that they own a functional brand (= recources) puts them above BW on my list.

    • Another thing Mahindra / Ssangyong could “buy” from Saab and generate a development return is our beloved IQon system as it seems they don’t have an OEM navigationsystem available. By the time Saab can introduce IQON, the system is tested and they can launch IQON V2 (or also invent a “gingerbread” or “Ice Cream Sandwich” type of naming)

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