Bankruptcy: Saab, GM and the Banks

There’s an interesting article/blog over at Forbes

The author, John Tamny, writes that the United States government feared that jobs would disappear if they allowed the auto-makers and banks in the United States to go into bankruptcy. So the United States government stepped in with bailout packages.

Tamny then goes on to look at Saab and how they dispelled the myth that bankruptcy means that the jobs will disappear. Saab went into the Swedish equivalent of Chapter 11 bankruptcy and came out the other side at its “market clearing level”. He then goes on to outline bankruptcy as a positive, and companies come out of it with better management practices ready to succeed.

Saab’s story is a reminder that as opposed to something we should fear, bankruptcy often is what ensures the perpetuation of things we like. Saab survived bankruptcy and lived to tell the story, and it’s time we apply the lessons of Saab to other corporate entities living off of the money of others.

Feel free to pop over and read for yourselves.


In Sweden, the finger-pointing continues….

Thanks once again to ctm for the tips. EnG
Well, I said last week that this is NOT the end of the General Motors/Saab saga, it’s merely the beginning of a new chapter. As this week begins that prophecy seems correct.
As we’ve seen before, Swedish entrprise minister Ms. Maud Olofsson and company still blame General Motors for abandonning Saab and seem to use that as an excuse to stand by and talk.
Jan-Ake Jonsson, CEO of Saab Automobiles, continues to lament the lack of government leadership and shifting attitudes from Sweden’s leadership.
In a Sunday evening television debate, Mr. Jonsson and Ms. Olofsson squared off with the same arguments given ad nauseum the week before.
Mr. Jonsson opines
“It’s important for us to get a signal from the government. I think the signals we’ve been getting from the government have been different.”
He also makes it clear that the waffling is stifling talks to find a buyer for Saab.
Mona Sahlin: a new ally?
During the debate, apparently Social Democratic party leader Mona Sahlin emerged as positive on the need to help Saab regain footing and continue as a primary employer in Sweden. She asserted, “The effects on taxpayers would be worse if Saab doesn’t get the chance to test its plan.” Mild optimism, but pro-Saab nonetheless.
Maud Olafsson: perhaps more articulate, but still harsh
Once again, it seems that Ms. Olafsson wears the black hat. However, at least she’s come forth with some sharper criteria for that now infamous harsh stance. It seems that the Swedish government wants a better business plan in place, which I think is understandable. However, she insists, “We need to know there is a secure ownership which takes responsibility for the business plan,” Yes, in a perfect world, I think that she has a point — strong owner leadership is the most desireable situation. However, we all know that this isn’t the best possible scenario, and survival is the key point of contention as things stand today.
Perhaps this is moving ever so slightly forward. At least labor management thinks so:
“Their message to us is clearer. It really feels like they want to stand up and help,” said labour representative Paul Åkerlund.
I’m definitely not that optimistic at this point.

EnG Snippets Monday Edition

There’s still plenty to write about which I’m sure is frustrating to Swade, given that he’s not got internet access.
In this post:
– One of the better summations of the past week from the Saab perspective comes from the AP wire photo of Jan-Ake Jonsson.
– Jalopnik’s Project Car Hell has some fun at GM Europe’s expense.
– Continued reports of interested buyers for Saab.

Read moreEnG Snippets Monday Edition

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