What the Deal With Hawtai Means for Saab *UPDATED*

First, as Victor texted from his cell phone from China, “This is it!”

And as our own commenter Bravada essentially said, “It’s time to Haw-tai!”

Basically the deal has two arms.

  • It gives Saab a very strong alliance in the Chinese market, not only to sell their cars in a vast dealer network, but also as a major opening for possible technology sharing and partnerships. This should help defray future development costs, especially for things like diesel engines which Hawtai has proven to be quite good at, and RedJ points out should give Saab access to the VM V6 diesel engine family again. In fact, at least a dozen manufacturers in China were vying to tie up with Saab, but they chose Hawtai because of their partnership with Italian VM Motori and their new advanced diesel engine plant.
  • It allows Saab a lifeline to continue operating with mid-term financing subject to approval from the Chinese government, EIB and Swedish NDO.

UPDATES

  • Many have noted in comments that the NG 9-3 will be built in China at a Hawtai factory exclusively for Chinese production. This was confirmed to several reporters at the press conference. “Production in China is for China, production in Trollhättan is for the rest of the world,” said Muller. “We believe we will sell more Saabs and if they are to be exported from Sweden, we will need more employees in Trollhättan,” he went on.
  • Muller expects the first payment to go through within the next 10 days, the rest of the €150 million will need to be approved by the Chinese government, EIB, and Swedish NDO and take 6-12 weeks. Any deal over $100 million US needs to be approved by the Chinese government, and China Car Times believes the deal should go through. According to Unni Jerndal, communications director at the National Debt Office, it has not received an application for ownership assessment yet, but as soon as it comes in they will try to work as quickly as they can. Fortunately the Gemini loan gives them a little breathing room.
  • According to Lars Carlstrom, Antonov was heavily involved in Saab’s deal though he hasn’t received approval to be part of Saab by the EIB just yet. “We have been eyeing Hawtai for a while and know about their activities. What we have learned is very, very positive,” he told just-auto.com.
  • The Spyker (soon to be Swedish Automobile) board will go from 3 seats to 4, adding a spot for Hawtai at the table.
  • By having the Chinese as part owners (up to 29.9%), that means they have a vested interest in Saab’s success, not just their own. This means they should be much more willing to develop technology on Saab’s behalf. When Saab makes money, they do too– this can’t be overlooked, and is one of the hidden benefits of the deal.
  • Also noted in comments by Niklas from an SvD interview, Victor Muller says that the current contract does not allow Hawtai to use Saab technology in their cars, but they are open to that possibility in the future. This means more cash for Saab, in essence this extends their potential lifeline even further.

Read moreWhat the Deal With Hawtai Means for Saab *UPDATED*

Press Release: Saab Automobile Enters Agreement With Hawtai Motor Group On Strategic Partnership

Trollhättan, Sweden: Following yesterday’s announcement that Spyker Cars N.V. (Spyker) secured its short term funding, Spyker announces today that Spyker and Saab Automobile AB (Saab Automobile) signed an agreement with Hawtai Motor Group Company Limited (Hawtai). This agreement conditionally secures medium term funding and includes financing in the form of subscription agreements in the amount of EUR 150 million as well as a strategic alliance for China including joint ventures on manufacturing, technology and distribution.

  • Spyker, Saab Automobile AB and Hawtai Motor Group sign agreement on strategic alliances partnership with respect to manufacturing, technology and distribution in China, subject to definitive transaction documentation
  • Spyker will enter into a subscription agreement with Hawtai in the total amount of EUR 120 million for in aggregate 24.6 million shares as well as a EUR 30 million convertible loan, subject to definitive transaction documentation and certain conditions

As a part of the transaction Hawtai will invest EUR 120 million for up to a maximum of a 29.9 percent equity stake in Spyker on a fully diluted basis. The remaining EUR 30 million will be in the form of a convertible loan agreement in the amount of EUR 30 million with a 6 month maturity, an interest rate of 7% per annum and a conversion price of EUR 4.88 per share. The transactions are subject to agreement on definitive transaction documents and certain conditions, which include consents from certain Chinese governmental agencies, the European Investment Bank and the Swedish National Debt Office. As part of the transaction, Tenaci Capital will convert EUR 42 million of its current loan to Spyker into share capital in Spyker at EUR 4.88 per share, thereby substantially reducing Spyker’s interest burden.

Victor Muller, CEO of Spyker and Chairman of Saab Automobile, said: “The partnership with Hawtai allows Saab Automobile on the one hand to continue executing its business plan since we secured the required mid-term financing subject to meeting certain conditions, whilst on the other hand it allows Saab Automobile to enter the Chinese car market and establish a technology partnership with a strong Chinese manufacturer.

“We expect that Saab’s unique brand values based on its aviation heritage, Scandinavian origins and innovation-driven character will do very well in the Chinese market. Our driver-oriented vehicles appeal to a whole new group of independently thinking customers who appreciate Saab’s advanced designs, safety and responsible performance.

“With Hawtai’s clean diesel engine technologies and production capacity, and its ambitious development programs, we have found the right partner to develop the Saab business and build a solid relationship.”

Mr Richard Zhang, Vice President of Hawtai, said: “This is a great day for our relatively young company which was founded ten years ago. The partnership with the iconic Saab brand will give us access to innovative technologies and an international network which would have taken us decades to build. On the other hand we have a very strong Chinese manufacturing and distribution infrastructure which we will make available to our new partner Saab Automobile. Our participation in Spyker, Saab’s parent company, demonstrates our commitment to the future of Saab Automobile as a premium European car manufacturer.”

Founded in 2000, Hawtai is a China-based privately-owned automotive company with its headquarters and R&D centre located in Beijing, and two production facilities located in Ordos, Inner Mongolia and Rongcheng, Shandong Province. Hawtai currently has an annual production capacity of 350,000 vehicles, 300,000 clean diesel engines and 450,000 automatic transmissions. By 2015, Hawtai aims to have raised this capacity to 1 million vehicles, 1 million engines and 1 million automatic transmissions, and to have established itself as a global leading automotive company.

 

Note to Editors:

Saab, or Svenska Aeroplan Aktiebolaget (Swedish Aircraft Company), was founded in 1937 as an aircraft manufacturer and revealed its first prototype passenger car 10 years later after the formation of the Saab Car Division. In 1990, Saab Automobile AB was created as a separate company, jointly owned by the Saab Scania Group and General Motors, and became a wholly-owned GM subsidiary in 2000. In February 2010, Spyker Cars N.V. of the Netherlands, acquired the company from GM as an independently-run business.

Saab cars reflect the brand’s unique Scandinavian design ethic, which is fused with its aircraft engineering heritage. The company is a global premium car maker with a distinguished history of innovation. It is recognized for its pioneering role in turbocharging, as well as occupant safety and the introduction of flex-fuel technology through Saab BioPower. Saab Automobile AB currently employs approximately 3,800 staff in Sweden, where it operates world-class production and technical development facilities at its headquarters in Trollhättan, 70 km north of Gothenburg.

CONTACT:

Saab Automobile Press Office

Tel: +46 (0)520 279797

By continuing to use the site, you agree to the use of cookies. more information

The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.

Close