By on September 8, 2011

 

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:

“Saab Automobile AB was denied bankruptcy protection from creditors by a Swedish court Thursday, clearing the way for labor unions representing unpaid workers to petition for bankruptcy and reclaim unpaid wages.”

As we reported two days ago, there were doubts whether the Saab application would fulfill the legal requirements for creditor protection. Namely, a sensible business plan, and reasonable hope for success. The Vänersborg district court could not find any of that in the application and denied it.  The court doubted the viability of Saab’s China deals and said it is unclear if and when the Chinese deals would be approved. Sounds familiar.

Saab will appeal. However, if Trollhättan’s hometown court doesn’t give Saab a chance of survival, it is highly unlikely that a court of appeals will see it differently. While the appeal process runs, Muller admitted today in a press conference, “the company is unprotected, and the stability we were seeking is not there. So we will appeal to all stakeholders to hold their horses until such time the appeal decision has been taken.”

Translation: Please, creditors, don’t file for bankruptcy, or we are done.

The next steps are as predictable as paint-by-numbers. Explains the WSJ:

“If Saab had been granted protection from creditors, it would have been able to use the Swedish state’s salary guarantee to pay wages and would have had more time to sort out its finances.

However, the union will likely proceed with a petition for a bankruptcy, as they can only seek state unemployment benefits if they petition for the bankruptcy of their employer.”

“We have no choice,” said Darko Davidovic, a lawyer for blue-collar labor union IF Metall. “We can’t play around with our members’ wages.”

Despite the appeal to hold the horses, the  media is already rolling out their eulogies. Writes Fortune:

“Without approval, Saab could disappear like many other automotive brands, from Hudson and Packard to Studebaker and Saturn. Muller’s company bought Saab from GM, following GM’s 2009 bankruptcy. GM has continued to supply components and engines to Saab, as well as fully-completed 9-4X models, a compact sport utility vehicle cloned from the Cadillac SRX and built at a GM plant in Ramos Arizpe, Mexico. “Saab hasn’t built anything since June,” said Jim Cain, a GM spokesman. “They’ve struggled to get financing. It’s too bad.”

We will run our Saab eulogy when Saab is really dead.Victor Muller said that the appeal is plan C and if that won’t work, he will go to plan D.  As in done, dead, demolished.

 

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35 Comments on “Bertel Schmitt Fired From TTAC – Saab Saved...”


  • avatar
    Philosophil

    Geez, Bertel. You actually had me until I got to “Saab Saved.” It was only the briefest of moments of shock (because I really like your contributions here), but you did have me for just a moment.

  • avatar
    Ingvar

    I find it interesting that the court cites Saabs lack of a viable business plan and their pipedream financials as the main reason to turn them down for protection. That means this situation is nobodies fault but Saabs, for simply not being a going concern. It’s not the EIB:s fault, it’s not the Swedish governments fault. Saab simply don’t have a case for making business, and no money to run the business with.

  • avatar
    philadlj

    Don’t scare us like that, Herr Schmitt! About you being fired, that is.

    I find it hard to believe the Appeals Court will find a “sensible business plan” and “reasonable hope for success” if the hometown court couldn’t.

    Which means Plan D is all but inevitable.

  • avatar
    APaGttH

    Friends, Swedes, countrymen, LEND ME YOUR EARS! For I have come to bury Saab, not to praise it. The evil that men do lives after them;
    The good is oft interred with their bones; So let it be with Saab…

  • avatar
    SilverHawk

    As someone who restores & maintains Studebakers, I can sympathize with
    those who own late model Saabs. In my area, the Saab fanatics are into the older series, and really don’t associate themselves with the current models. The point being that a very good network exists here in the US to keep Saabs on the road for generations to come. Even today, 45 years after the last 1966 Cruiser rolled off the assembly line, Studebakers still put thousands of miles on US and Canadian roads every year. Now is the time for those who really love Saab to show what they’re made of, and leave poor Bertel alone.

    • 0 avatar
      APaGttH

      One key difference. When Studabaker went belly up there were massive amounts of spares, parts, body panels, etc. etc. available. An obscene, no wonder they went bankrupt with that much pats inventory, ready for the apocolypse amount of spare parts.

  • avatar
    redbeard

    Anyone else notice this article?

    http://consumerist.com/2011/09/whatever-you-do-dont-lose-your-saab-key.html

  • avatar

    What I think is most sad is the brand is all but dead, not because the existing organization was unable to move enough units to pay the bills, but because they very same people either unwilling or unable to save the company will likely retain ownership rights to the brand forever, removing the potential for anyone to reboot the brand from a shed somewhere in the Swedish backwoods.

    Whatever. SAAB might be dead, but I think the spirit of SAAB will live on. If there’s one thing I’ve learned as a digital gearhead over the years, it’s that there are few people more creative and committed to doing things differently than the Swedes.

    Where there’s a will, there is a way, and though I think we’ve seen the last of yet another storied brand thanks in part to corporate malfeasance, I doubt we’ve seen the last of clever, eccentric motoring from the land of the Prancing Møøse.

  • avatar
    majorfrn

    Bertel and Best and Brightest:

    What happens to the existing tooling and designs in bankruptcy? I saw a new 9-5 on the road yesterday and it is a very good looking car. Seem like someone could still build and sell it. Also the 9-4X has gotten very good reviews. Do you think the 9-5 tooling will get sold for scrap, or is it likely to go to BAIC in a bankruptcy fire sale? I’ve also read the Trollhattan plant is quite modern, in cases like that is it likely to become another car maker’s plant or just cease to exist?

    Could you speculate on what becomes of the Saab brand? Any chance that the Chinese, after picking up the remains for a song, might keep some production going at Trollhattan, and keep the brand name alive?

    Think I also read that there might be some licensing issues with the Saab name.

    • 0 avatar

      This is all speculation, but educated:

      - It has been on the Beijing grapevine for a while that BAIC is interested in the tooling
      - A high ranking executive of the Chinese delegation that had inspected Trollhättan was heard by a source remarking that the facilities are first rate, but in the wrong place. They should be in China where “workers don’t work from 9 to 5 for huge sums of money.”
      - The Saab brand is listed as owned by the Saab AB, the aircraft company. This is public information. The brand is most likely licensed to Saab, the car company. Usually, these license contracts are non-transferrable, and the license reverts back to the original owner in case of a default. Again, this is what usual practice is. It is not necessarily the case here. However, the likelihood is high.
      - GM has licensed some of their technology to Saab, and that usually cannot be transferred without the licensor’s permission.

      In my humble opinion, to sort these things out will be a royal mess.

      • 0 avatar
        stroker49

        Yes, that is right about the Saab brand. It can not be transferred. Like Rover, now called Rowar or something similar. I was working ten years for SAAB AB (the supersonic fighter producer and subcontractor to Boeing) and still have friends there. They are not happy. They can not buy a box of ordinary titanium screws without paying in advance as most peoples can not understand the difference between Saab AB and Swedish Automobile AB producing cars under the brand Saab.

    • 0 avatar
      Seán Moloney

      Saab already sold their plant to a Swedish investment firm. I’m not sure of the name… Hemfosa I think. They sold half of the plant to them with a 15 year lease-back agreement. The idea is that if Saab were to go bankrupt that Hemfosa would get the remaining property as insurance for the unpaid rent.

      I am a Saab fan, and I hope they find a way. I really do, but if it should come to pass that Saab does disappear then I’ve had nearly two years to prepare for such an event, and I have actually spent much of that time looking for other cars that I like to replace my 9-5 Estate. I think I’ve finally settled on a Volkswagen Passat Estate, or if I were to downsize perhaps an Audi A3/S3.

      I really don’t understand what the suppliers hope to gain out of a bankruptcy. I know that its mainly the unions pushing for one so that their members can gain the governments unemployment benefits, but some suppliers have also hinted this way. Honestly, what has Saab got to pay back the suppliers in the event of a bankruptcy? Their plant belongs to Hemfosa, their name belongs to the original company (Saab AB) and all of their technology belongs to GM. What else is there? Not to mention that in the event of a bankruptcy, not only will the government have to cover employee wages, but being Saab’s guarantor for the EIB loan, they would also have to fork out to pay that back as well wouldn’t they?

      • 0 avatar
        Ingvar

        Saab supplier Lear is apparantly ten million dollars back on taxes for wages already paid. With no money coming in from Saab, they have simply been forced to push the taxes in front of them, to the point of being forced into bankruptcy themselves. They have annonuced plans to lay off 200 employees, but with no money coming in, I have a hard time seeing them survive. Some suppliers are more independent of Saabs being or staying, but others aren’t. We will see a row of suppliers falling like a house of cards in the nearest future.

  • avatar

    If I understand GM’s deal with Spyker correctly GM still pretty much owns everything except for the brand name and shifted the operating costs to Spyker/Muller to deal with. When Saab goes bust all the hard bits are still GM property. I doubt that anyone will come in and want to buy the brand name without anything tangible attatched to it. I doubt that GM will be hot to sell anything related to the current 9-4 and 9-5 since both are fundamentally the same vehicles GM sells elsewhere. It’s possible the 9-3′s bones could be sold like the old 9-5s to the highest Chinese bidder to live on as a Chinese car.

  • avatar
    Robbie

    I’m done crying. Does anyone know whether there any bargains to be had on the inventory of the last Saabs ?

    • 0 avatar
      Educator(of teachers)Dan

      In about a week I bet they’ll be REAL cheap, be sure to get one that has largely GM mechanical bits so you the only thing you need to worry about is getting in a wreck and not being able to find sheet-metal.

      • 0 avatar

        Even at nearly 10k off they still aren’t “cheap”. Every dealer I’ve talked to coast to coast says that bankruptcy won’t affect their pricing, at least for now. I’m looking to pick up a 9-5 Aero for more than 10k off and waiting for the opportunity. You’re probably best off seeking out standalone Saab stores who will really be hurt.

  • avatar
    eldard

    Why don’t Saab employees just threaten the courts with physical violence? lolz

  • avatar
    GS650G

    Women and Children to the lifeboats.

  • avatar
    gmbuoy

    if/when saab dies GM l think would set SAAB service and parts up just like it handled Saturn, through other channel stores, glad its finally over we would have been far better off if we had never bought it in the first place…per public disclosure policy a gm employee

  • avatar
    mazder3

    I know it’s been done but it bears repeating:
    The Dead Collector: Bring out yer dead! [a man puts a body on the cart, unaware of the fact that the man is actually alive]
    Large Man with Dead Body: Here’s one.
    The Dead Collector: That’ll be ninepence.
    The Dead Body That Claims It Isn’t: I’m not dead.
    The Dead Collector: What?
    Large Man with Dead Body: Nothing. [hands the collector his money] There’s your ninepence.
    The Dead Body That Claims It Isn’t: I’m not dead!
    The Dead Collector: ‘Ere, he says he’s not dead.
    Large Man with Dead Body: Yes he is.
    The Dead Body That Claims It Isn’t: I’m not.
    The Dead Collector: He isn’t.
    Large Man with Dead Body: Well, he will be soon, he’s very ill.
    The Dead Body That Claims It Isn’t: I’m getting better.
    Large Man with Dead Body: No you’re not, you’ll be stone dead in a moment.
    The Dead Collector: Well, I can’t take him like that. It’s against regulations.
    The Dead Body That Claims It Isn’t: I don’t want to go on the cart.
    Large Man with Dead Body: Oh, don’t be such a baby.
    The Dead Collector: I can’t take him.
    The Dead Body That Claims It Isn’t: I feel fine.
    Large Man with Dead Body: Oh, do me a favor.
    The Dead Collector: I can’t.
    Large Man with Dead Body: Well, can you hang around for a couple of minutes? He won’t be long.
    The Dead Collector: I promised I’d be at the Robinsons’. They’ve lost nine today.
    Large Man with Dead Body: Well, when’s your next round?
    The Dead Collector: Thursday.
    The Dead Body That Claims It Isn’t: I think I’ll go for a walk.
    Large Man with Dead Body: You’re not fooling anyone, you know. Isn’t there anything you could do?
    The Dead Body That Claims It Isn’t: I feel happy. I feel happy. [The collecter glances up and down the street furtively, then whacks the body with his club, solving the problem]
    Large Man with Dead Body: Ah, thank you very much.
    The Dead Collector: Not at all. See you on Thursday.
    Large Man with Dead Body: Right.

    • 0 avatar
      mazder3

      And now, for the illiterate…

      http://www.youtube.com/watch?v=grbSQ6O6kbs

      FF to 1:00 for the dialog.

    • 0 avatar
      Wheatridger

      That’s exactly the role TTAC has played during SAAB’s terminal illness– the impatient angel of death, tapping his foot and watching the clock while SAAB’s long terminal struggle played out. I suppose it’s irresistible to deconstruct and debunk their overconfident claims, but let’s remember that behind the corporate bluster are a bunch of unemployed workers and a once-proud and brave nameplate. From the start, SAABs were different. In the ’60s, they gave us a cheap, rally-proven alternative to the Beetle; in the ’70s, a pioneering turbo with explosive performance; in the ’80s, roomy & versatile cars like the 9000. No need to remember the ’90s and beyond, we know that too well. Count SAAB as another GM casualty.

      Here’s what I’d like to know about SAAB: more about the quirks and strengths of its best & worst cars, and its future, as far as owners are concerned. I don’t think we’ve seen this situation recently, in the US, at least. It’s not the orderly winding-down of Olds or Saturn. but the complete financial failure of an independent car maker. If I were still a SAAB owner, I’d wonder about parts availability, and who I’d buy them from. If that wasn’t a problem, I’d wonder about the closeout deals.

      • 0 avatar

        Blaming the media for Saab’s ills is part of the Trollhättan syndrome, a paradoxical psychological phenomenon like the Stockholm syndrome where workers and flagwavers express empathy for the people who have cheated them. The victims defend them against any enemies imagined, the government, the European Investment Bank, GM, even TTAC. A site like TTAC can influence the fate of Saab as much as a hummingbird can influence the weather.

        My heart goes out to the workers who have been betrayed with false promises. Victor Muller is responsible for their paycheck, we aren’t. Knowing the Swedish system a bit, I don’t feel too bad for the workers. Their unemployment benefits are generous, and they had a paid vacation since April.

        Having said that,I also must mention that some of Saab’s fans have been the brand’s worst enemies. I have received countless threats, ranging from announcements of visits by the Russian Mafia to suggestions about my wife, or that I should perform fellatio on the author of the message. A large number of threats emanated from Russia, some from Denmark, some from Alexandria, VA. I grew up in the investigative journalism business before I copped out and chose the cushier and much better paying career in advertising. Now that I’m back to writing, I answer threats just like I did back then: I only dig deeper. In the case of Saab, a kid’s shovel was enough to uncover more dirt than I had ever seen in that business.

  • avatar
    John Horner

    Saab Automotive spent the vast majority of its life on life support from one or another parent company. It had very few independent profitable years along the way, and never had enough volume to really fund its development needs.

    They made some interesting cars for sure, but it has been over for Saab for quite some time now.

  • avatar

    Next week a new court ruling is expected after Muller filed for appeal. Next week is also the deadline for the unions to apply for unemployment benefits by filing for bankruptcy. Btw, the comment of the Economic Affairs Minister, that it is highly unusual for the court to reject a plan to reorganize, can be explained twofold. Saab aficionados thought it was opportunistic, considering that the Swedish government never believed in Muller’s plans. Others may come to the conclusion that Saab’s situation has become hopeless.

    • 0 avatar
      Ingvar

      Everyone was taken with surprise, from the ground up, because everyone simply thought it was a given that the court would fold and cave in to Saabs pressure. Remember, this is the local county court in Saabs hometown, a town with less then 50 000 residents.

      Though, with the courts given instructions, they had nothing else to do but turn them down. Because there’s simply no “reasonable hope for success”. If Saab had had a business case, they wouldn’t have been turned down. And the court officials said so, almost shamefully apologetic.

      And an appeal to higher courts will only be considered if the circumstances have changed dramatically in the meantime. That means, if Müller comes up with some sort of viable business proposition that is tied down to reality.

  • avatar
    Dixi

    And in the meantime…

    http://www.bnr.nl/topic/beurs/525642-1109/muller-zorgeloos-in-tiger-rolls

  • avatar
    Paul W

    Saab should already be bankrupt if the union officials had done their damn job. But apparently they are more concerned with their own image in the history books than the wellbeing of their members. They’d rather see the workers go without pay for a few more weeks and live on bread and water, than becoming known as the ones who finally pulled the plug on Saab.


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