GM’s China chief Kevin Wale poured a huge bucket of ice-cold water over hopes that China’s Pangda and Youngman will rescue Saab. The deal needs to be approved by the Chinese government, the European Investment Bank, the Swedish government and – GM.
Wale told Reuters today: (Read More…)
While the flagwavers at Saabsunited wallow in the good news that the Swedish king announced at an annual moose hunt near Trollhättan that Victor Muller is a great guy, far away in Detroit, GM spokesman Jim Cain issued to Reuters what sounds like the death sentence to the sale of Saab to China’s Youngman and Pangda:
“GM would not be able to support a change in the ownership of Saab which could negatively impact GM’s existing relationships in China or otherwise adversely affect GM’s interests worldwide.”
The exactly same statement was sent to the Wall Street Journal, and GM will send it to anyone who asks what GM thinks of the deal. If Muller would have asked before announcing the sale, he most likely would have received the same answer.
Translation: (Read More…)
Pangda, one of Saab’s presumptive white knights, could itself be facing financial difficulties. Both the staid government-owned China Daily and the more outspoken Taiwan-based China Times report strange financial going-ons at PangDa. Says China Times:
“Shareholders and securities analysts are scratching their heads over how a top automobile marketing group in China managed to “burn” a huge fund of 6 billion yuan (US$944 million) in just six months. Many have speculated that Pang Da Automobile Trade Co has shifted to financial leasing services to cope with stalling car sales caused by the government’s credit-tightening regulations.”
According to China Daily, $659 million had been “used to repay bank loans and supplement working capital.” China Times reports a lot of the money as lost and says: (Read More…)
On the last possible day to work out a deal before being forced into bankruptcy, the Victor Muller era has ended at Saab. The Swedish brand will now become a completely Chinese-owned company… if all goes to plan. A press release explains
Swedish Automobile N.V. (Swan) announces that it entered into a memorandum of understanding with Pang Da and Youngman for the sale and purchase of 100% of the shares of Saab Automobile AB (Saab Automobile) and Saab Great Britain Ltd. (Saab GB) for a consideration of EUR 100 million…
…The administrator in Saab Automobile’s voluntary reorganisation, Mr. Guy Lofalk, has withdrawn his application to exit reorganisation. The MOU is valid until November 15 of this year, provided Saab Automobile stays in reorganisation.
But remember, this is Saab… and its fate rests in the hands of many, many people not named Victor Muller. Despite the air of finality that is surrounding some of the media coverage of this latest announcement, this is not a done deal. The Saab saga rolls on…
There was no better place to clear up some questions about Saab than in Chengdu. After all, nowhere can you find the CEOs of all major Chinese carmakers and government officials all under the same roof, or even at your dining table. There also was no better place to get entangled in the messiest web of facts and fiction. Here is some local color: (Read More…)
Death with Dignity apparently does not exist in Victor Muller’s vocabulary, as Reuters reports that the CEO of Saab’s parent company will receive loans from prospective investor Youngman in order to ward off liquidation in Swedish bankruptcy court. Youngman has committed some $97m in bridge loan financing to the troubled Swedish automaker, of which Saab has received $15m so far and will receive more payments this week in order to pay salaries and other expenses. Saab spokeswoman Gunilla Gustavs explains
“We are putting bridge financing in place so we can fund business during the reorganisation — so we don’t incur new debt. We have running costs, such as electricity, that we need to take care of. There are a number of business-critical operations that need to be funded”
Saab’s salaries are currently guaranteed by the Swedish government as part of Saab’s bankruptcy protection, but that guarantee expires on October 21, just before October salaries are due. Missing that payment would likely have spelled the end of Saab, but with Youngman’s money arriving in dribs and drabs it seems that we may be documenting the firm’s undignified collapse for another month or so.
Pangda’s Chairman Pang Qinghua was not in Stockholm as reported. He was in Chengdu. At least today. As you can see above, he smiled into TTAC’s camera. At the sidelines of the conference, Chairman Pang had told Fang Yan of Reuters:
“Now that it’s in bankruptcy protection, all previous pacts are invalid. It’s up to the court to decide. It can also find a new partner.”
Talking to Fang Yan again, Pang qualified the statement:
“What I meant was that during restructuring, the court is authorised to adapt any restructuring plans, including vetoing previous agreements. It’s up to the one handling the reorganisation to decide whether previous agreements are valid or not. I am sticking to the commitment. Yes, I am confident about it.”
Saab calls the initial comments a “misunderstanding,” and Victor Muller apparently texted Reuters to say the deal with both PangDa and Youngman are “on track.” But, as Bertel reported yesterday, the real issue is whether or not Saab has any intellectual property to bring to the table. If not, the Chinese government will not approve the deal, regardless of how optimistic Muller, Pang, or the Swedish bankruptcy administrator who controls Saab’s fate are. The furor over Pang’s comments have provided a temporary smokescreen for that issue, but it won’t last…
The Chengdu meeting might ruin the appetite of the Saab faithful. Saab wasn’t a topic during the proceedings, although Volvo was mentioned a lot. On the sidelines of the conference however, death sentences to Saab where handed out by the truckload.
Jim Holder, Editor of the U.K. magazine AutoCar is at the meeting. He scooped me by learning from a highly reliable source:
“A last-minute rescue deal to save Saab is virtually certain to be blocked by the Chinese government, meaning the company is almost certain to be declared bankrupt – possibly as soon as later today. (Read More…)
A bloated management, run-away costs, declining market share, imploding volume, a sell-off of assets and investments, headquartered in Detroit – what is it? No, it’s none of the Detroit automakers. It is their former nemesis and current co-owner, the United Auto Workers.
“Two years after the wrenching restructuring of the U.S. auto industry and the bankruptcies that remade General Motors and Chrysler, the UAW is facing its own financial reckoning. America’s richest union has been living beyond its means and running down its savings, an analysis of its financial records shows. Unless King and other officials succeed with a turnaround plan still taking shape, the next financial crisis in Detroit may not be at one of the automakers but at the UAW itself.”
This is the beginning of a special report written by the best in the reporting business, by Deepa Seetharaman and her boss, Kevin Krolicki, Chief of the Detroit Bureau of Reuters, with the help of their team of combat reporters from the Detroit front-lines. (Read More…)
Saab is on court ordered life support. On appeal, the Court of Appeals for Western Sweden has approved Saab’s request for protection from creditors. Saab can now attempt a business reconstruction without the threat of imminent bankruptcy, The Local reports. (Read More…)
Writing these Saab stories is becoming as much fun as visiting a fading relative in a hospice: You have to do it, but you want to get it behind you, quickly. Today is the day a court in Sweden will decide whether it admits Saab’s appeal of a prior court decision that would have forced the Swedes into bankruptcy. In the meantime, Victor Muller came up with another plan. (Read More…)
That’s not us making the prediction. Stockholm News says that “Saab’s fate could be decided on Tuesday.” On Monday, the Court of Appeals will meet and will deliberate whether Saab will be allowed to appeal the District Court’s denial of a reconstruction.
Stockholm News does not expect a decision until Tuesday. But it predicts: (Read More…)
The white-collar unions Unionen and Ledarna filed bankruptcy petitions today against Saab, everybody from Associated Press to inside.saab reports. On the same day, Saab announced that it had licensed its PhoeniX architecture to China’s Youngman at firesale prices – a move that could possibly buy another month or two. But first things first: (Read More…)
As if Victor Muller doesn’t have enough problems. He has managed to upset Sweden’s state collection agency Kronofogden so much that they are threatening arrest. Muller claimed there is enough money to pay the employees, but if he does that, the state collection agency will get its hands on the money. The collection agency says that Muller has to hand over the cash or go to jail. This quote by Victor Muller sent Hans Ryberg, head of the enforcement agency in Uddevalla to the ceiling: (Read More…)
This was the headline many Saab aficionados were looking for (and we have the emails to prove it.) On Saab’s darkest day, we might as well put a smile on the faces of Saab’s most militant missionaries – even if the smile lasts only a few seconds.
Two days ago, Saab filed for court protection – the Swedish variant of Chapter 11. That must be approved by the court – and today, the court denied it. Says the Wall Street Journal: (Read More…)
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