If we’ve learned anything from animated cats over the last several decades, it’s that opposites can attract (and that music video directors get all the good drugs). But if there are serious doubts among analysts about the Fiat-Chrysler hookup, imagine what they’re saying about the Saab-Koenigsegg deal. After all, the buying firm sells one-of-a-kind cars for a cool million dollars a pop while the purchased firm can’t sell reworked GM offerings at zero-percent interest. Is there something rotten in the state of Sweden?
You know the alliance is less than ideal because of the $700 million dowry needed to convince the opposites to attract. That’s 700 units worth of revenue for Koenigsegg, which builds about 25 cars per year (based on the latest numbers we could find). The Wall Street Journal reports that Koenigsegg has only 45 full-time employees, and that the two firms make for “strange bedfellows.” Not since the Minelli-Gest marriage have there been stranger. And to what do we owe the spectacle of two wholly dissimilar firms struggling to make their marriage work? Politics, of course. “Koenigsegg is the preferred option of the Swedish government for political reasons,” is how analysts put it to the WSJ. Now imagine Shelby Supercars buying Saturn, and you have an idea of how wacky this adventure is going to be.
http://img.photobucket.com/albums/v391/dogsledder54/2012Saab.jpg
This is almost too easy.
Koenigsegg’s wife was quoted as saying “We are a company that is focused on the big picture, on the pleasure of driving and on testing limits”
Nothing wrong with that, at least its a change, not the same old thinking that GM is surely going to continue.
Yes, obviously this was set up to look like a Swedish “Car” company is saving SAAB. Of course they are doing it with money backed by the Swedish Govt. Now SAAB management can run their little car company without interference from GM or any other company. Good Luck!
Don’t forget they were on their knees before GM bought them. Had GM not bought them they would be in the same place as Hudson, Nash and all the other car companies of the past. GM did not fix Saab but they kept them on life support. I suggest all you Saab lovers start writing checks ASAP because Saab will be extinct as soon as the Swedish Govt gets tired of giving them money.
Yes, obviously this was set up to look like a Swedish “Car” company is saving SAAB. Of course they are doing it with money backed by the Swedish Govt. Now SAAB management can run their little car company without interference from GM or any other company. Good Luck!
I think they could easily be successful if they downsize and start making niche cars for a smaller consumer base. It can be pretty amazing what can happen when a car company is focused on making a great car instead of trying to maximize sales via “volume by re-branding”.
Look at Harley Davidson for example. They almost collapsed and then went on to become one of the strongest brands in the motorcycle market simply by making fewer bikes which were better than the unreliable large volume bikes that got them into trouble.
I hope they make it work. The new owners can’t be worse than GM.
I thought GM had moved Saab production to Belgium or Germany where they also make Opels. What did the new owners get out of this deal as far a production facilities?
If Koenigsegg currently have no problem persuading a few people to buy a car that has none of the brand cachet of a Ferrari for 3 times the cost of a Ferrari, then they should have no problem persuading a few more people to buy a car that has none of the brand cachet of a BMW for a few thousand less than a BMW. I suspect most of Koenigsegg’s current sales are to wealthy Swedes (if that isn’t an oxymoron knowing their income tax rates), and I suspect a Swedish owned and operated Saab would attract many customers from their homeland and allow the company to retrench in that market.
the buying firm sells one-of-a-kind cars for a cool million dollars a pop
Well that has to work better than the giant buying firm (GM) selling homogenized crap with massive rebates that previously owned SAAB. Couldn’t be any worse, could it?
You have two very small car companies with very different products and disciplines. There could be some synergy there. Let’s hope. SAAB’s were fun back in the SPG/9000 Aero days, maybe they’ll get some of that mojo back.
Quote: frizzlefry….“Look at Harley Davidson for example. They almost collapsed and then went on to become one of the strongest brands in the motorcycle market simply by making fewer bikes which were better than the unreliable large volume bikes that got them into trouble.”
True…Harley came back from the brink but their success was more due to the Reagan-era protectionist and severe taxation of imported bikes and the success of their motor-clothes line. Today, for every dollar Harley Davidson makes on motorcycles, they make nine dollars on their motor-clothes line. I don’t think Saab has a clothing line that will glean them such an incredible revenue stream.
It is at least questionable to believe that Koenigsegg was chosen for “political” reasons.
The Swedish government have made it crystal clear that they are not willing to support SAAB for political reasons of whatever kind.
Koenigsegg are backed up by investors from Norway and – so goes the saying – the US.
To choose Koenigsegg must have made sense to both Deutsche Bank, who were involved in the search for a new owner for SAAB, and to GM. And it makes sense from a marketing point of view.
As a whole, the deal, which is still not official, is by far less strange, let alone funny, than some people try to make it appear.
It may be wrong on a number of levels… but I still love the idea. I think I slept better last night knowing this was the plan for Saab. It put a smile on my face, this is the best plot twist to come of GM’s demise.
If Koenigsegg currently have no problem persuading a few people to buy a car that has none of the brand cachet of a Ferrari for 3 times the cost of a Ferrari…
I would certainly say that there is brand cachet with the Koenigsegg. I saw one parked on a sidewalk downtown during rush-hour to promote a car show that was coming to town. Everyone stared at it. Some of the things I heard people saying about it were “Holy *nsfw*”, “Wow”, “Oh my god” and “If I won the lottery…”.
The more I think about this, the more I’m liking it, or maybe I’m just being unreasonably optimistic.
That’s probably it because Shelby buying Saturn sounds alright to me too. I guess anything has got to be better then being owned by GM?
Car freaks like us know about Koenigsegg, even if we can’t spell it, or pronounce it correctly. But we know about it.
They’ve got a pretty interesting flagship vehicle. So if they got a hold of a factory, couldn’t they possibly do something like Valmet and contract to build stuff for other people?
Couldn’t they possibly leverage their exoticar expertise into getting into the turning business, like Alpina?
Then again, they might have some silent partner with very deep pockets who always wanted to own a car factory.
Look at Harley Davidson for example. They almost collapsed and then went on to become one of the strongest brands in the motorcycle market simply by making fewer bikes which were better than the unreliable large volume bikes that got them into trouble.
Not the best example in the world. Several things went into “saving” the company:
1) Gubmint contracts. Yeah, all you “free market uber alles” types out there probably aren’t aware that in the early 80s when the company was bought back from AMF, it’s bikes were still crap and still weren’t selling. Enter DoD. HD got a contract to build bomb casings for the Army (yes the Army) and the Air Force. It seems the HD plants were so antiquated, they were great at making WWII era 500 pound bomb casings which were still very much a mainstay weapon system for us. That provided the revenue stream HD needed to modernize it’s production facilities and design some bikes that were slightly less excreable than the stuff they’d been producing over the previous 15 years.
2) Gubmint protectionism. During this same time frame, St Ronnie slapped a 50% tarriff on certain Japanese bike imports (the larger ones that were killing HD at the time, think Honda Gold Wing and to a lesser extent the Kawasaki 900 and above series) for 5 years to give HD “breathing room” to become more productive and efficient. Hmmmmm, sound familiar? If he had listened to the libertarian free market zealots at the time, HD would have gone the way of Nash, Studebaker and the lot. Again, hmmmmmmm.
HD has done an amazing job of branding itself during the years of easy credit and two bubbles (first tech, then housing). Chalk it up to their marketing. That enabled middle-aged bubbas who generally also buy ‘Murkin automobiles to indulge themselves for another $15k for a shiney new toy as long as the monthly payments didn’t cut into the overall lifestyle. And as Stu said above, they are a case study in how to successfully “brand” something. That’s their revenue stream.
Their bikes are still very problematic in terms of reliability and “out of the factory working”. I’ve known at least a dozen passionate HD drivers over the last 20 years. Each and every one of them always has to put another $5k at least into their bikes. And each and every one needs to get them serviced and repaired in such a way that would make a Pontiac Sunfire look like the most reliable motor vehicle on the planet.
I was waiting for that line of crap.
As someone who’s had a ’98 Harley FXSTS (that’s Springer Softail to you), such comments on Harley reliability only show one thing: You neither own nor ride one.
I’ve got 46K on mine (it’s not my main ride) and while the maintenance costs are a bit more than my ’95 Triumph (101K and the most perfect bike I’ve ever owned), it’s certainly in the same ballpark with past BMW’s, Kawasaki’s, and definitely less than my past Ducati.
It’s as reliable as anything else out there. Period. And all you need to do is ride a Japanese cruiser, then ride the Harley, and you understand one of the reasons why they’ve sold so many motorcycles over the past two decades. It ain’t all about leather and black t-shirts.
Oh yeah, I know the Japanese cruisers. I work at a Honda dealership. I’ve ridden most of them.
I suspect most of Koenigsegg’s current sales are to wealthy Swedes(if that isn’t an oxymoron knowing their income tax rates)
While they have high income and consumption taxes (a 25% VAT) they have relatively low corporate and capital gains taxes. So yes, a number of rich people in Sweden.
Well, Government “too big to fail” Motors is bankrupt.
Koenigsegg is solvent. The change will be good for Saab, and may provide some economies of scale for Koenigsegg.
But my interest in Saab disappeared with the 900. They lost their adorable quirkiness when they moved the ignition switch from the center console. Today there is nothing distinctive about their offerings, which is one of their biggest problems. Maybe Koenigsegg will solve that issue.
And nobody cares about Saab’s airplane heritage. Many car companies have built airplanes in the past. I recall a time when GM-built planes duked it out against Mitsubishi-built planes.
Sitting@home said:
If Koenigsegg currently have no problem persuading a few people to buy a car that has none of the brand cachet of a Ferrari for 3 times the cost of a Ferrari, then they should have no problem persuading a few more people to buy a car that has none of the brand cachet of a BMW for a few thousand less than a BMW. I
Well, that they only sell 25 per year shows that they can only persuade a FEW people to buy a car . . . 3 times the cost of a Ferrari . . .
I imagine that Koenigsegg’s market is for the people that already have a Ferrari, a Lambo a Veryon etc. In other words, people who worked for AIG.
I don’t think the problems are the brand equities the two bring.
I don’t see how a small outfit can raise the money necessary to revise the 9-3, continue to build a 9-5 and 9-4, and still sell supercars. The Swedish press is apparently somewhat skeptical as well. Lets see who the other investors are.
SAABs have always had a few “performance” oriented cars — the original 900 turbo, the Viggen, and the Aeros. I agree the current 9-3 is a mess, although the newest ones are cleaned up quite a bit. The new 9-5 looks ok although that segment isn’t going anywhere for a while.
Koenigsegg appeals to those that wants to be different. They don’t need the brand cachet of Ferrari, when Ferrari churns out 5000 cars a year. They don’t even have to be as good as Ferrari. Different is good enough, parking your car next to a row of 599 GTBs on the local country club.
And no, I don’t think that many are sold to Swedes. Swedish people with that kind of money to spare, are usually in for Lambos, Ferraris and perhaps the odd McLaren. I would think that Koenigseggs demographic reads more like Russian oligarchs, Saudi royalty, American gumballers that pays with daddys money, and perhaps some oddball sports celebrity.
With an owner that wants to (re)develop saab as a brand, there is potential in that company. I think Saab might be the sort of brand that a luxury-prius type car would do very well in, and have the cachet to appeal to the right sort of customers.
Koenigsegg seems to build more cars than anyone else trying to buy Saab at this point, at least. And they’re clearly passionate about cars, which should count for something. Saab might do very well under them as a near luxury mark, emphasizing driving fun and efficiencies. Koenigsegg has stated, in the past, that he wants the brand to grow to be competition for the likes of Ferrari or Lamborghini. This might be a means to do that.
As a Saab owner (2002 95-aero wagon) I feel better about this than I would feel as a Chry/Jeep owner about a marriage with Fiat. (And, BTW, gslipp, the key is still on the console next to the shifter in my Saab. While the car has been something of a maintenance headache (as we speak, with less than 80K miles, both oil seals are leaking mildly), it does have its virtues. For a FWD, it has very neutral handling, and the 250 HP aero car gets an honest-to-God 31 mpg on the highway at 70 with the AC running. So, if I were running Saab, I’d up the QA and figure out how to breed the coarseness out of the small displacement turbo’ed 4. (The V-6s in the newer versions of this car appear to be comparative gas hogs, judging by their EPA ratings). I certainly don’t think there’s room for another BMW-Audi-Mercedes Euro vehicle. So, if Saab’s going to work, it’s going to have to be a niche model . . . and yes, at a price point a little under those cars. Someone said on this site that Saab’s “natural” and historical market drifted off to Subaru, which is a good point (although I’ve never owned or considered one). Perhaps Saab can appeal to those who are sorta Subaru-oriented, but would like something that looks a little less like it was thrown together by some talented Japanese engineers with no regard for style or aesthetics.
@grog :
June 12th, 2009 at 4:24 pm
+1
Who cares if you are solvent. Koenigsegg is so small compared to Saab that its turnover is just a rounding error in Saabs profit and loss statement.
From what I understand…GM’s basically giving the company to Koenigsegg including cash, tooling and other assets, and rights to the newest “Saab” cars (which include GM IP mostly from Opel). GM basically wipes the slate clean, gets to announce a sale, and now all the problems belong to the Swedes.
I’m not sure Koenigsegg really brings anything to the table and there are certainly no synergies. On the other hand, there’s little if any downside to Koenigsegg either.
Bruce,
9-5 Linear here, 2004 w/93k miles. So far, no leaks, and in a milder state of tune getting about 33mpg on the open road. That said, your comment about the coarseness of the turbo-4 comes from the fact that the 9-5’s 2.3L engine was stroked out from the 2.0 liter versions, hence it’s a bit buzzier. When the old 9-5 is finally retired, so will the engine, the last of the “old Saab” fours. The current 2.0L engines in the 9-3s are a newer GM design.
The only thing that worries me is that the car is one of the fastest road cars in the world. It is an awesome motor but if one of these other companies (Thank god not GM) get hold of this dream machine it would never be the same again!
London Removals, your comment just flew right over my head. Care to elaborate?
At any rate…
It’s ironic that a company rooted in the aircraft industry has been saved by a company who operates out of the former home of Sweden’s RAF who used to fly Saab-built fighter jets. It looks like fate and destiny have come full circle.
My sister has a 2006 9-3 and it’s a nice car, I don’t see what GM f***ed up so bad about it (but I haven’t looked real hard either). If Koenigsaab can improve whatever it is that’s been “lost” then I’ll likely make a Saab my next purchase.