Since we’ve already irritated Saabistas by posting a comparison of the Nissan Juke to the 96, we might as well just come out and say it: Saab is one sick puppy. Third quarter results are out for the Dutch-Swedish automaker, and they’re not good: the firm has lost $70m on an operating basis last quarter, and has burnt through $160m in the the first nine months of 2010 [full results in PDF here]. Wholesale and retail sales in the first three quarters were down by 10 percent and 45 percent respectively compared to the first nine months of 2009, and Saab has cut its 2010 sales projections from 45,000 units to 30,000 units, or half of the 60k projection Saab started 2010 with. Improbably, the company still believes it will sell 80,000 Saabs next year, and 120,000 in 2012. And though Saab-Spyker has a negative equity of about $234m, the company says it does not need to recapitalize. In other words, comparisons to the Nissan Juke are the very least of Saab’s worries.
For context, Automotive News [sub] reports that Volvo has posted an undisclosed operating profit in Q3, and Stephan Jacoby is optimistic about ending 2010 in the black. We’ll have to wait for year-end results for details though.
Improbably, the company still believes it will sell 80,000 Saabs next year, and 120,000 in 2012.
They must be utilizing VW’s marketing group.
It’s no secret that GM was able to move what Saab metal they could mostly through subsidized leasing. By inflating residuals (thus lowering monthly payments), GM with their then-captive finance arm made Saab a viable alternative financially to the leasing public (with GM eating residual optimism after the lessees tossed back the keys).
It’s also no secret I have a soft spot for the Trollhattan express, and would like them to survive. So, last week, I contacted my dealer and informed him it might be time to drive home another 9-3 — this time, a convertible, lease, 12-36 months, all tax, licensing, and cap costs up front, please.
Putting pencil to paper, figuring in Saab’s $5k cash back and $2k current owner bonus cash, he came back with (drum roll)…
$600 per month. $4k down. For a 2010. For 36 months.
This puts a Saab 9-3 above the BMW 3-series convertibles. Above the Volvo convertible. Within spitting distance of the new 2011 M-B E-Class convertible.
Yes, the dealer admitted as much. And made excuses about exchange rates, etc.
So the news that Saab’s sales are tanking are no surprise. Now that Saab is going it alone, we can hope they build great cars which will command premium dollars. But in the meantime, without a friendly uncle in the banking business, Saab is in for some tough sledding.
Stick a fork in them. These Swedish meatballs are done.
The sales projections are disappointing, but were they ever expecting to do anything but burn money at this point? The new 9-5 has barely even hit dealerships; I don’t think anyone expected them to ride back to victory on the old 9-3.
It will take a miracle to reverse this kind of negative feedback loop. As more potential buyers worry about the long term viability of the brand fewer of them will be willing to buy Saab vehicles. And as sales continue to slide concerns about the survival of Saab will only deepen. I suspect that there will always be hard-core enthusiasts who will buy Saab vehicles regardless of the health of the company. I very much doubt, though, that this relatively small pool of buyers would be sufficient to sustain the brand.
BTW, I prefer Sabbinista to Saabista … it rolls more easily off the tongue and has a more rebellious edge to it!
30,000 units does not seem like enough to sustain a moped manufacturer let alone a heavy industrial undertaking like automobile fabrication.
I think what Saab needs is (with apologies to Jeremy Clarkson) a reasonably priced car. I like the very un-Saablike 9-5, and my local dealer here in MA told me sales have been ahead of his projections.
The problem is, they need a competitive entry level model. The current 9-3 is now on its 8th year, and while it’s a decent car, it’s not really competitive, not with 270hp Sonatas flying around. A niche manufacturer trying to play in the mainstream will have trouble getting traction with a $50K car, as good as it may be. I think a slick, new 9-3 is what they need to get their mojo back.
It’s interesting to compare the Jaguar turnaround to the current attempt at turning around SAAB. Jaguar recognised the need to reinvent the company by embracing a brave new styling direction. The result was a sales upturn. SAAB looks to it’s past and sales keep falling… time to change the record SAAB.
Dunno, the new 9-5’s styling is a pretty serious break from the previous gen. And it actually doesn’t look like every other luxobarge on the road! Somehow they managed to include the requisite stretchy headlights, eyebrows, side crease, and gunslit windows while making it look quite distinctive. It certainly doesn’t look anything like the 9-3 or previous 9-5 at all.
What else were they going to do?
Memo to: TSTAG
First, don’t hold out for a long lived Jaguar company. No sense being optimistic in this economic climate. Second, this is very good news from Saab. After all, the sooner they stop selling automobiles, the sooner we can forget about them and move on to something else–like Jaguar. This entire saga has been going on longer than nature intended, and it’s about time for natural selection to rear its ugly head. Go torque steer!
RE Jaguar. yes they still have some way to go, but they have money, and some of the best growth numbers in the business. In fact their sales growth numbers are only beaten by a handful of established brands. Most notably land Rover
A Saab story indeed. How long until the rest of the tooling and trademarks end up with a Chinese buyer at dimes on the dollar?
I believe that’s exactly what happened to the old 9-5’s tooling already.
They’re so toast that we’d might as well be discussing Saturn’s chances. The NEW 9-5s are carrying eight to ten thousand dollar discounts before you start negotiating. The only ones I’ve even seen are in dealer inventories. Saab of Santa Ana has new 2010 9-3s in stock starting at $20,580. I doubt you can get an atuomatic Honda Civic EX for that in California. I know that the new 9-5 is still just a Buick, but you can’t go far needing close to 20% discounts on your cars the day they’re released.