Saab Museum could be threatened

Swedish publication Allt om Motor featured an article over the weekend indicating that the Saab Museum in Trollhattan could come under threat, perhaps even during the re-organsation process.
They interviewed a re-organisation administrator, though not the one involved in Saab’s re-organisation, who has emphasised the fact that sentimentality plays no part in the re-organisation process. The objective is to clean up the balance sheet and organise the business in such a way that it can be profitable in the future.

During the reorganization process, the Museum is of no value. The job now is to clean up the balance sheet and nothing else. But in case it becomes bankrupt museum can have problems, “says Rolf Åbjörnsson.
– If there is a commercial value of several million in the museum there is a risk that the collection could be sold at auction. Social or cultural values are not taken into account in the event of bankruptcy, it is purely monetary flow that applies, he believes.

There may be a little bit that’s lot in translation there. I’m not sure if he’s implying that the museum could be sold off during re-organisation, or just in the event that Saab’s re-organisation ends in a bankruptcy proceeding.
Saab Museum curator, Peter Bäckström, feels fairly comfortable with the immediate future:

Saab Automobile AB owns and operates the museum, but the property belongs to Trollhättan municipality. What will happen to the museum if Saab is closed, nobody knows. But museum Director Peter Bäckström is hopeful.
– Saab is Trollhättan. The reorganization process will be challenging, but it would surprise me if the administrator felt the need to close the museum, “he says.

I hope that’s correct. I’d hate to see all those beautiful cars just sold off to the highest bidder.
I’m sure that any future purchase of Saab will include the 110 vehicles in the Museum’s collection. If not, then I hope the city of Trollhattan will take steps to ensure the collection’s future.
That’s something I’d definitely donate towards.
Click through for video.

Read moreSaab Museum could be threatened

Wednesday Snippets – Saab dealers, lottery winners, new bailouts

UPDATES:

  • There are now 12,736 registered rescuers at www.rescue-saab.com
  • The Saab 9-3x has 717 votes (12%) in the Car and Driver poll, which puts it in 4th place behind the Audi $8 V10, the Aston Martin V12 Vantage and the Ford Focus RS.

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A former Saab employee and Trollhattan resident won a lottery in Sweden last week. He pocketed almost 3 million kronor from his 32SEK ticket.
What to do on such an occasion?

“We celebrated with champagne at home and as soon as I have the money in my account, it is said that a new Saab and a new computer. Then we shall see”, ends winner who wants to remain anonymous.

Congratulations!
Thanks Per!
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The need for a bailout isn’t just an American or European phenomenon anymore.
The seemingly invincible Toyota has asked for a $3billion dollar support package for it’s wholly owned finance arm.
In addition to that, Honda, Nissan and Mazda are also going to the Japan Bank for support.
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With so much uncertainty surrounding Saab at the moment, dealers are having to strategise as to how they’re going to get through the current crisis and stay in business.
The Sewell group of dealership in Texas is thinking of specialising in used vehicles:

Sewell Hummer and Sewell Saab, which share facilities in Dallas and Plano, are proceeding with business as usual – though both sell seven to 10 times as many used vehicles as new, owner Carl Sewell said Friday.
Ultimately, both could evolve into high-end used car operations similar in concept to a CarMax, said Sewell, chairman of Dallas-based Sewell Automotive Cos.

I’ve featured Sewell here before and it seems they’re a good bunch of people to have carrying the Saab name. I hope they can hold out.
If there’s any other dealers tuning in, feel free to let us know how you’re holding up and what you’re doing to ensure you can carry through.
Thanks Bill!

GM’s-in-the-crapper Snippets

Before we get to how much trouble GM are in, there was a great report on Bloomberg News about the effect the current situation with Saab is having on life in Trollhattan.

Mona-Britt Olsson says she knows who to blame for the panic gripping Saab Automobile’s hometown of Trollhaettan in southern Sweden: Industry Minister Maud Olofsson.
“Maud Olofsson is not very popular here these days,” said Olsson, 67, who worked for Saab for 30 years before retiring. “She probably shouldn’t walk alone here at night.”
Olsson and the 45,000 inhabitants of the industrial town on Sweden’s western coast are in attack mode after Saab, Trollhaettan’s biggest employer, filed for bankruptcy protection on Feb. 20. Their rage is split between parent General Motors Corp. and the government for their refusal to give aid, risking thousands of jobs and the survival of a Swedish engineering icon.

It really is well worth a read.
I love this little city. I have fantastic, idyllic memories of my time there and the people I met during that glorious week back in 2007. This is a place that can’t be left high and dry.
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Now, to the crapper.
GM just released their 2008 financial results and as someone mentioned in comments earlier today, they really do appear to be collapsing under their own weight. Let’s hope that’s not the case as we need them to stay alive to allow Saab to reorganise.

For the 2008 calendar year, GM reported an adjusted net loss, excluding special items, of $16.8 billion, or $29.00 per diluted share. This compares to an adjusted net loss of $279 million, or $0.49 per diluted share in 2007. The 2008 results were driven by the impact of the U.S. recession and subsequent global contagion. Including special items, the company reported a loss of $30.9 billion, or $53.32 per diluted share

GM stock is currently trading at $2.55 a share.
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To add to that little bit of misery, GM are facing massive protests in Germany today.

“Workers of GM Europe are sending one message today: Opel must not die and will not die,” Berthold Huber, chairman of the IG Metall labor union, told protestors at division headquarters in the Frankfurt suburb of Ruesselsheim, a rally he said had attracted 15,000 demonstrators.

And meanwhile, EU Ministers are taking a leaf out of Maud Olofsson’s book:

Verheugen said the commission intended to protect GM’s European subsidiaries, adding, “We do not believe that you can solve the overcapacity problem by throwing the weakest people off the sledge.”
But he also stressed that any aid to Opel would have to be accompanied by thorough restructuring plans, placing the blame for the situation squarely on GM.

The EU have stated that they will take legal action against any government that unfairly props up it’s car industry. I’m not sure how they can do that outside the EU, but apparently they think they can.

Additional reconstuction reading from the press

More fodder for those or you looking for a different angle on things….
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From Forbes: Saab Bids GM Farewell
Defining quote:
“Today is the beginning of a new chapter in Saab’s history,” says Jan Ake Jonsson, managing director of Saab. “We are now recreating Saab Automobile as an independent unit. The road ahead will not be easy.”
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From CNNMoney: GM Units In Europe, Korea, Appeal For Aid To Stay Open
Defining quote:
“[Let’s picture] Saab as an independent car company with … low sales volumes,” said state secretary Joran Hagglund at the Swedish Ministry of Enterprise, Energy and Communication. “If you listen to analysts, then they say there’s not a chance such a company can survive. So what I’m really saying is that you should keep your expectations very low.”
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From Bloomberg: Saab Seeks Protection From Creditors as GM Pulls Out
Defining quote:
“Unless the Swedish government is prepared to put a lot of money into Saab, I think that this is just another step down the road to the graveyard,” said Stephen Pope, chief global strategist at Cantor Fitzgerald in London.
——————-
From Reuters: Saab Story
Defining quote:
“Saab said it would seek funding from public and private sources through the reorganization, and that GM would provide liquidity.”
—————–
From Sky News, UK: Safe, Strong And Not Here For Long
Defining quote:
“The question is who’s going to want to put up that sort of money for a for a company that can’t stand on its own two feet? “
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From the Sydney Morning News: Sweden ready to let Saab drive off cliff
Defining quote:
“Saab employs 4100 workers in Sweden, and another 10,000 jobs are linked to subcontractors, making it an industrial powerhouse in a country of just 9 million. Unemployment in Sweden reached 7.3 per cent in January.”

GM bailout news – press conference

UPDATE VII: Rick Wagoner just signed the death certificate – asked by Mark Phelan of the Detroit Free Press whether there was a third option for Saab (other than sale or closing) and he said he can’t envision a scenario where GM would continue support (words to that effect).
Effectively: someone buys Saab or GM drop them. According to the plan, that could happen this month.
UPDATE VI: It’s quite clear from the The Plan that GM plan to divest themselves of Saab, sooner rather than later.
In short, they are hanging Saab out to dry. Their capping of financial support for the reorganisation of Saab looks a lot like forcing Saab into the reluctant hands of the Swedish government.
Every reference to Saab in The Plan is a reference to them being gone. There’s no language that indicates that GM will support Saab in a reorganisation effort.
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From the Plan:

Sweden/Saab–The Company has conducted a strategic review of its global Saab business and has offered it for sale. Given the urgency of stemming sizeable outflows associated with Saab operations, GM is requesting Swedish Government support prior to any sale. The Company has developed a specific proposal that would have the effect of capping GM’s financial support, with Saab’s operations effectively becoming an independent business entity effective January 1, 2010. While GM is hopeful that an agreement can be reached with the Swedish Government to support this direction, the Saab Automobile AB subsidiary could file for Reorganization as early as this month.

Saturn, HUMMER and Saab have generated an average annual EBIT loss of $1.1 billion

UPDATE V – Am waiting to ask a question. Fingers crossed. Am downloading plan right now.
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UPDATE IV – They have asked for support from several other governments, including Sweden. If Maud was in the audience, I think she would have thrown a shoe at him!!
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UPDATE III – They have offered Saab for sale and capped the finance they can offer. If the issue can’t be settled then Saab would likely have file for reorganisation.
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UPDATE II – It’s a “bold” plan!!
Wow.
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UPDATE – they’re running a few minutes late, apparently. I’m on the conference call.
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General Motors have scheduled a press conference for 6.30pm EST (in the US) which is just under two hours from now.
If the bandwidth gods are kind to us all, you should be able to watch it here.
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For those of you who speak Swedish, there is an interview with Sweden’s minister in charge of saying negative things about Saab, Maud Olofsson.
I don’t speak Swedish but I heard at least one “bolaget” in there, a “December”, a lot of “Saab” and “Gee-Emm” reference, plenty of head shaking and at least one speak-to-the-hand.
There’s footage from Trollhattan, too. I’d love to live there. Seriously.
UPDATE:
A quick summary from ctm:

What she says is that the government has offered GM all the available loans and guarantees since December, but that GM has refused. Now, she says, Saab contacted the government “this evening” and told them they will themselves hand in a loan application to EIB. It’s really weird. And she says she has no idea what GMs plan will contain when it’s presented. And she claims that GM is still owner of Saab and they are obviously responsible. If Saab is cut loose, then Saab will be treated as any one and offered guarantees and loans.

Saab 9-5 production coming back to Trollhattan?

With many thinks to Daniel B, here’s a translation of an article in today’s Dagens Industri newspaper in Sweden. There’s no link as at the time of publishing, it wasn’t online.
Maybe this is why Klaus Franz was trumpeting goodwill towards Saab and the German factory continuing to produce the 9-5 for Saab even if they’re sold off by GM.
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Saab wants to take the german production home
Saab Automobile is working hard to get the production of the new 9-5 from Russelsheim in Germany, back home to Sweden. It has shown that the factory in Trollhättan lately has passed the German factory in aspects of effeciency and cost.
According to the sources of Dagens Industri Saab has studied the options of taking the production of the new 9-5 home to Trollhättan as well as the 9-3 convertible. The suprisingly fast improvement of the efficiency in the Swedish factory presented itself at Saabs most recent board-meeting last Tuesday, when Carl-Peter Forster reported on the status.
Håkan Danielsson, the chairman of the union Swedish Engineers says: We had requested a presentation about which of the two factories were the most cost-efficient as per manufacturing cost per vehicle and the Trollhättan factory turned out to be the one.
The cost per manufactured 9-5 at Trollhättan is about 20 000 SEK (swedish kronor) which turned out to be approximately 2000 SEK less than the Russelsheim factory (Approx 20% ) (I’m not sure of the math there – SW).
This means that the original desicion to move the production of the new 9-5 from Sweden to Germany is being questioned.
“It is obvious that GM´s leaders in Europe first will protect the German interests as well as German jobs. One reason is probably fear of the German unions”, Håkan Danielsson says, who participated at the GM board-meeting.
“It was never an option at the meeting to change the desicion of manufacturing the NG 9-5 in Germany, on the contrary it was discussed to further move jobs to Russelsheim” Danielsson says.
Now they are speaking of design workers to move their jobs away from Trollhättan.
“For example designing of roof-boxes (for skiis), bike-holders and other optionals that we always have been good at in Trollhättan is being moved even though we are more cost-efficient.” says Danielsson.
One reason for Saabs efficiency, is the billion-class investments that has been made in the factory. Bodywork, painting, steelpresses and assembly departments are completely new with state of the art equipment and facilities. Manufacturing has been improved multiple times and the salory-costs is much lower than in Germany.
“For engineers and other white-collar workers the salories can be up to 40% lower in Trollhättan compared to Russelsheim and for the blue-collar workers the difference is approximately up to 50% lower at Trollhättan.” Danielsson says.
He tells us that more than few of the engineers makes approximately 3000 euros per month while the German engineers are being paid between 5-6000 euros.
The calculation of costs does not include logistics where Russelsheim is doing better, “but according to our calculations we still are cheaper then the Germans. Especially in Saabs big markets as Sweden, the US, UK we are better of then Russelsheim due to the fact that we are close to a major harbour”. (Gothenburg).
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I like it when the engineers talk. They seem to be pretty straight shooters.
You might remember that this same guy was speaking last week about the possibility of Saab and Volvo merging, in the company of a Volvo engineer. They were speaking as one and as representatives of Sveriges Ingenjörer, the association for graduate beer drinkers engineers.
I hope he gets to talk some more.

Thanks Daniel B!!

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