It used to be that “produce where you sell” is the answer to the rising yen. Amongst Japanese car manufacturers, Japan’s Godzilla currency is regarded as a bigger threat than any natural disasters. Mitsubishi is opposing this trend. It announced today that it will stop making cars in Western Europe. On closer inspection, this fits the “produce where you sell” strategy quite nicely. Mitsubishi is not doing so well in the Old Country. The Nikkei [sub] penned press-release worthy material when it wrote:

“Contending increasing international competition being compounded by the stubbornly strong yen, the Japanese car maker will stop production at its Netherlands Car BV unit by the end of 2012 as it strives to step up optimizing its global manufacturing operations to focus more on emerging markets.” 

Mitsubishi’s Nedcar plant is located in Born, in a part of the country that was called “the appendix of the Netherlands” by some of its neighbors, until the fall of visible borders made such ribbing superfluous. More irritatingly, the plant has an annual output capacity of 100,000 vehicles, but NedCar had only produced 23,808 vehicles by the end of 2011, as company data say.

Mitsubishi Global Production 2011

A look at this table shows why Mitsubishi is focused on the emerging markets. In calendar 2011 Mitsubishi’s total global production stood at 1,140,332 units, down 2.8 percent from the prior year. A little bit more than half of that was produced in Japan. In most other established markets, Mitsubishi produces only in homeopathic dosages.

In Western Europe, Mitsubishi currently builds the Colt compact and the Outlander SUV in Born, it imports the rest. In 2011, Mitsubishi sold a total of 95,225 units in the EU, the second lowest result of automakers tracked by Europe’s manufacturer association ACEA. In the U.S., Mitsubishi sold 79,020 units in 2011, up 42 percent from 2010.

Mitsubishi told the Nikkei that it will not retreat from Europe. The common market will be supplied with vehicles coming from Japan and Thailand.

“We filed a Chapter 11 just in case a white knight comes out of nowhere and buys Saab`s parent.”

Dealers are being owed money for unpaid warranty, incentive reimbursement and sundry others. Per dealer, the sums are said to range from $79.11 to $167,977.98.

The Church of St. Victor has a different version. Under the headline “Saab US Dealers Ask For Chapter 11 Protection,” they write:

“Take this as a good sign, today 41 US dealers asked a judge for Chapter 11 protection which would allow them greater involvement in a liquidation and to preserve whatever structure they can in case a bid for the entire company is accepted.”

Fellow blogsters and spinmeisters: If you ask a judge for Chapter 11 protection, then it’s YOU who is hounded by creditors and collection agencies, and it’s you who wants protection. Which would be more than plausible with a lot full of cars nobody wants.

PS: After some of the flock complain, the church changes the headline “Saab US Dealers Ask For Chapter 11 Protection” to “Saab US Dealers Ask For SCNA Chapter 11 Protection.” Not a big improvement as long as the copy stays the same.

Tom Carpenter, co-owner of Auto Center Southeast in Groveport, OH, had three Saturn dealerships. In 2009, GM euthanized Saturn, and Carpenter had to look for new cars to sell. Now, he is looking again.

Last August, Carpenter signed up for a Saab franchise. Carpenter “was aware of the manufacturer’s financial concerns but thought it was on solid ground,” says the Columbus Dispatch. Saab’s production lines had not been moving since April.

That enormous leap of faith was unrewarded. In December, Saab filed for bankruptcy. Carpenter was “not ready to say the brand is dead,” wrote the paper last December. Carpenter joined the ranks of the Saab faithful who hoped for a white knight.

On January 23, Saab Cars North America was liquidated. Saab of Columbus  has 18 new Saabs on the lot, and 2 used ones. In a final closeout sale, no reasonable offer will be refused.

Scott Carpenter is looking for new cars to sell. For the second time in two years.

The story on Saab pulling the plug on the diagnostic computer, and hence on repairs that need that access, ruffled a lot of feathers.  The Church of St. Victor is so angry at the apostate article that it broke its self-imposed code of silence and mentions TTAC by name. Delusional as they are, they believe that their links send us traffic. Selfless as we are, we probably have done more to Saabsunited’s fame than any other site. Ingrates as they are, they call our story

“the most stupid article I have ever seen! This website has no clue how things work and this is why we never refer to them… I’m making a one time side-step from that policy!”

In their rage, they overlooked a small detail …

The source of this story is no other than Martin Jaenicke. Herr Jaenicke happens to be the chief of Saab’s dealer council in Germany, he speaks for all remaining 80 Saab dealers in Germany. Yesterday, Jaenicke  gave an interview to Germany’s Kfz-Betrieb. If you have an auto workshop in Germany, you have a subscription to Kfz-Betrieb. Mr Jaenicke told the magazine’s news chief Jens Rehberg, that

“many customers sell their Saab now, because they worry about the parts supply. Saab workshops are faced with many imponderabilities that need to be clarified as soon as possible.Currently, workshops can only perform very limited repairs, because online access necessary for work on on-board computers has been switched off. At the successor company in Sweden, which is taking care of these processes, the necessary systems need yet to be installed.”

We may not have a clue how things work at Saab, but we sure hope that the head of the dealer council does. In talking to some contacts, we pick up ruminations that the switched-off computer may have something to do with pressuring dealers into signing a new contract. Investigating …

If you believe certain accounts, heroic Saab employees selflessly bought their own toilet paper in a last ditch operation to defend crumbling Saab.

Jaenicke has a more sober perspective:

“The remaining contacts at Saab, when confronted by me with these and other matters, appear to be unable to cope at the moment.”

Even more damning, Jaenicke likes the receivers – Swedish lawyers, not selfless Saab employees – better than the old hands at Saab:

“With the receivers and Saab Parts AB, we finally found contacts who at least think they are competent.”

As for the bankruptcy, the dealer chief thinks it should have been declared much earlier:

“A year ago it was already evident that there is not enough money, even if the lines could be started again.”

Meanwhile over at the faithful, all is peachy. Says the latest missive to the flock:

“There are also some other really big spare-parts news that I would LOVE to reveal to you right now, but I’m not allowed to so keep your shirt on, keep driving those great Saab’s and don’t worry, your life with a Saab will not be a problem! =).”

Probably more disconcerting to a Saab owner: Repairs that are more complex than the exchange of wear parts have become next to impossible, because someone at Saab literally pulled the plug.

“Currently, workshops can only perform very limited repairs, because online access necessary for work on on-board computers has been switched off.”

So says the usually reliable and well-informed Kfz-Betrieb, the German magazine for professional automobile workshops.  Without such online access, anything that is more complex than changing a brake pad will become either an ordeal, or impossible.

In a modern car, even something as simple as replacing a lost key becomes unmanageable when the electronic umbilical cord to the factory is cut.

Renault and Nissan chief Carlos Ghosn continues to prepare the battlefield of world opinion for a drop in Europe. According to Ghosn, Automobile sales in Europe could decline two to three percent. For Renault’s home market, he expects a drop of five to six percent, Ghosn said in an interview with France Inter radio:

“It’s going to be tough for everyone, not just for Renault. What really worries us is France, as we’re very sensitive to the French market.”

For 2011, Renault reported a 5.7 percent drop in sales in Europe, which was offset by a 19 percent gain elsewhere. Renault’s global sales rose 3.6 percent to a record 2.7 million units.

A soft Europe may be tough for everyone, but for some in particular. Opel and Fiat come to mind. Opel is for all intents and purposes limited to the European market, and will take the full brunt of a drop in sales. Fiat is heavy in Europe, and especially heavy in southern Europe, which goes through serious problems. Volkswagen, BMW, Daimler are exposed, but can more than make it up with exports to and sales in foreign markets. A soft Euro converts into high profits at home.

“There have been no formal bids,” receiver Anne-Marie Pouteaux told Reuters. Her colleague Hans Bergvist added that they “ have had discussions with a number of interested parties. Some of them are interested in the factory as a whole and some of them are interested in parts of it.”  But no, no bid.

It would be folly to place a bid, because even the receivers don’t know yet what that bid will buy. In a press conference on Saturday, receiver Hans Bergvist said:

“Everything that was possible to pawn in Saab has been pawned. The work to identify Saab’s assets is not yet complete, but we have come a long way.”

Anybody who had lent Saab money recently, did so with assets pledged. In July, just as a for instance, Saab sold 50.1 percent of its real estate holdings to a consortium led by Hemfosa Fastigheter AB, for about $40m. They leased it right back, with the proviso that the rest is security for the rent. Should Saab default on the rent, the contract allegedly said, then the consortium will say tack så mycket and  owns the whole thing.

Even in a bunker in Sweden, from which the last faithful had been sending blog posts in support of the zombie brand, defeatism makes the rounds.

“The headline everywhere is “Saab is dead”, which actually, right now, is true.”

This amazing revelation comes from Saabsunited, which continues:

“The fact that Saab has not even had money to buy toilet-paper since march is a fact that not a lot of people knew about. We’ve heard horror story after horror story from Saab employees and suppliers describing how a company has to act when it is completely out of money and saving up on absolutely everything! But despite having to clean the offices, toilets, kitchens and even buy supplies themselves for their own money the employees stayed at their post! They did not leave which is the biggest evidence of how great Saab actually was.”

They said it: Was.

And the reaction from the peanut gallery?

“+1!”

“+2!”

“+3!”

“Griffin up!”

Everybody is talking about how much the Euro is losing against the dollar. At closer look, it is not alarming. Even during normal times I have seen lower Euro rates than the current $1.27. But wait until you look at the Euro from a Japanese perspective. (Like the one I have at the moment, sitting in a pittoresk cabin half way up Mount Fuji that could use better heat.) The anemic euro might discourage people like me from coming to Japan. What it really does is discourage Japanese automakers from exporting to Europe. A lot has been said about the strength of the Yen against the dollar. It’s nothing compared to the Euro. Against the Euro, the yen turned into Godzilla. This has Japanese automakers extremely worried. They don’t really know what to do about it.

The Nikkei [sub] made a table of manufacturers’ assumed exchange rates, i.e. the exchange rate that is in the budget, and of the drop in operating profit for each yen below that rate. The table is in yen. The dollar fetches around 77 yen ( it has fetched less) at the moment. If there is 1,000 in the right column, then think there are $13 million.

On Monday, the Euro momentarily dropped to 97 yen in Tokyo, its lowest level in about 11 years. Let’s run the numbers for Toyota. Assume the Euro stays there, that would cost Toyota $779 million in operating profit – in Europe alone. Ouch!

The pain is even greater for small Mazda. Says The Nikkei:

“Among automakers, Mazda Motor Corp. is most seriously affected by the euro’s deprecation because it has no plants in Europe. It exported some 200,000 Mazda 3s and Mazda 2s to Europe, including Russia, in 2010. But because exports are unprofitable at the euro’s current exchange rate, Mazda will try to make due for now with cost cuts.”

Mazda is aiming for a 25 percent cut in procurement and production costs, but that may not be enough. Even for automakers with local production in Europe, the euro is falling faster than they can adjust production.

The low Euro of course is a boon for European automakers, especially for the export-heavy Germans. I would love to see a table that discloses how much more money they make for every cent the Euro sinks, but I have never seen such a table.

If you look closely, and with an open mind, you see something else that is highly alarming: The dollar/euro rate is masking the fact that both are dropping rapidly. Euro and dollar fall, the euro just falls a little faster than the greenback It is like two people who just fell out of another airplane. One watching the other guy, the drop might look benign. Viewed from the bottom (and this is where Japan should be,) it looks like a ….. get out of the way!!!!

Want  a piece of “quirky” history?  While the good folks at the Church of the One True Saab still have dreams of white knights, Saab’s heritage is being auctioned off. This caught the attention of Bringatrailer.com (“The best vintage and classic cars for sale online.”) In a lengthy piece, the organ for trailer trash collector’s online hub salivates over “the entire collection of 100+ cars belonging to the Saab Heritage Museum in Trollhaettan, Sweden” to the liquidator.

The cars  include everything from the 1946 Ur-Saab to recent show prototypes. Complete listing here, in Swedish. A rare collector’s item in itself!123 pages, 2 pictures per car. Saab history, written by the executioner. Download your piece of Saab history for  FREE!

As for the auction, you don’t even need to bring a trailer to drag away your loot. Also on auction are the workhorses of the museum which include an enclosed trailer, and a Saab 9000 back-halved flat-bed hauler.

The cars are auctioned off by the Swedish law firm Delphi. Written bids on the collection, as a whole, or, come on, cheapskate, individually, are requested via mail or fax by this Friday, January 20th. Instructions here.

Place your bids, or do we have to send Steve Lang over there? Come on, didn’t you always wanted to own the concept cars, just as they show them at the car show? Now you can. Their loss, your gain.

Basically, new car sales in Europe have been going sideways for decades. (Forget the irritating red percentage change line. Look at the bars.) The downward tenor since 2007 is more a reflection of ageing and shrinking populations in Europe’s volume markets than a result of booms or busts. Europe as a whole does not have the wild swings of the U.S., where many people have three cars, or of China, where most people still don’t have a car. Europe is filled with capable carmakers who defend their territory with tooth and nails.

(Note to the crowd that likes to blame miserable sales elsewhere on secret import restrictions: The “non-EU” brands – no matter where the cars are made – have a share of 16.6 percent of the European market. It’s been like this as long as I can remember.)

New car registrations 2011, EU 27

More than 80 percent of all EU sales are generated in a special part of Europe called “the volume countries” in the EU car biz. The volume countries are Germany, France, the UK, Spain, and Benelux. What happens here shapes the market. You see nearly 9 percent growth in Germany, single digit losses in France and the UK, double digit losses in Italy and Spain.

New car registrations 2011, EU 27 by manufacturer group

No breathtaking changes on the manufacturer front. Volkswagen continues to grow. It gained 2 percent more market share. No other carmaker gained (or lost) that much of the European market. Hyundai & Kia grow steadily. Nissan is the Japanese surprise.

Imported cars from the U.S. are unsalable: GM had imported 1070 U.S. cars in 2010 . That dropped to 440 in 2011. The 172,000 “Chevrolets” come from Korea.

If you give the data a good read, then you will see a divided Europe. Northern and most of Eastern Europe are doing just fine, thank you. Vacation lands Italy, Spain, Portugal, Greece are hard hit.

OIf there is so much bleeding, why is there so much foot-dragging about saving the Euro? The low Euro powers the export machine in the north. The stellar earnings of Volkswagen, Daimler, BMW et al are driven by strong exports and strong sales in foreign markets. The weaker the Euro, the better for them.

Yesterday, the alleged enthusiast blog did play its usual “if we would tell you, they would shoot us” about a possible suitor from India:

“We are not allowed to reveal the identity of the company yet, but we are allowed to reveal some facts about it. They are of course based in India but acts on a world-wide basis with much more than 100’000 employees worldwide. They are a multi-billion dollar company, that work on multiple fields such as energy, logistics, real estate and of course within the aerospace and automotive industry.”

Bloomberg does not bother playing twenty questions and reports:

 “Mahindra & Mahindra Ltd., India’s biggest sport-utility vehicle manufacturer, is interested in buying at least parts of bankrupt Swedish carmaker Saab Automobile, two people familiar with the situation said.”

 Not more is known about the matter. According to Swedish media, Mahindra hasn’t even had an audience with the administrators yet.

A pair of senior police officers in Brindisi, Italy were arrested Tuesday in a speed camera bribery scheme. The owner of a BMW X6 blew the whistle on officers Giuseppe Manca and Antonio Briganti after a speed camera accused him of driving 160km/h (99 MPH) on state route 16, where the limit is 110km/h (68 MPH).

The driver faced a fine of between 500 to 2000 euros (US $650 to $2615) plus license points. The officers offered to make the conviction disappear for payment of 250 euros (US $327) in cash. The officers were able to erase the conviction from the speed camera logs to prevent detection of their tactics.

The attempt at secrecy failed when the BMW found he was out of cash. The driver’s account of what transpired is supported by surveillance video showing one of the policemen escorting him to a bank in the village of Pezze di Greco to withdraw money. Judge Paula Liaci ordered Briganti and Manca to be placed in preventative detention.

Meanwhile, the public prosecutor in Grosseto conducted four raids on the offices of speed camera companies in Capagnativo and Scarlino. Investigators uncovered irregularities in the way speed camera contracts were handed out in those jurisdictions between 2005 and 2007. Previously, local police handled speed camera operations, but prosecutors insist forgery, corruption and bid rigging led to the decision to contract out the photo ticketing services.

Investigations into Italian speed camera fraud have been in the works for years. Earlier this month, seven were arrested in Frosinone for rigging speed camera contracts. In March, the Guardia di Finanza announced five indictments in Brescia. In August 2009, speed cameras were shrouded in black plastic as up to 200 officials faced charges in Caserta. In September, a judge ruled that a group of 15 mayors, cops, speed camera company employees should stand trial on fraud charges.

[Courtesy: Thenewspaper.com]

Thinking of cashing in on Saab’s misfortunes? Contemplating your own bankruptcy deal, where you can buy a brand new (well, nicely aged on the dealer lot) Saab for pennies on the dollar? Think again. Edmunds.com Senior Consumer Advice Editor Philip Reed says you will be in for a nasty surprise:

“Consumers shouldn’t expect a fire sale on unsold Saabs just yet. While incentives are no longer being offered for now, our research indicates pricing remains unchanged at Saab dealerships. Dealers are taking a wait-and-see approach since this situation is changing rapidly. But Edmunds.com analysts estimate that the True Market Value price of new vehicles will be discounted by an average of 28 percent from MSRP — and as high as 33 percent in some cases.”

That may happen, down the road. Currently, prices at some dealers are going up. Yes, you heard right. Up. Edmunds found a Saab dealership in Los Angeles where new Saabs are sold in “as-is” condition as if they were used cars, but they are priced at full MSRP. The reasoning is that some models had $12,000 in incentives the previous day, but these price breaks were no longer available because of the bankruptcy.

One reader told us that he went to a Saab dealer, made a lowball offer, only to hear the story that because Saab is in bankruptcy, the company will buy back all cars on dealer’s lots. Sure. And low flying pigs were sighted of Trollhättan.

If you are worried that you may have to live without daily episodes of the Saab Soap, now that the company is bankrupt, worry no more. Or in the words of Saabsunited: “never ever give up!” The show will go on.

Today, Automotive news China [sub] reports:

“Zhejiang Youngman Lotus Automobile Co. says it has purchased Saab Automobile’s Phoenix architecture despite its failure to acquire the automaker itself. Youngman already has set up a company in Sweden to develop new models based on the architecture, said Rachel Pang, Youngman’s spokeswoman and daughter of Youngman President Pang Qingnian.”

The trouble is, nobody in Sweden or elsewhere has heard about it. As far as Sveriges Radio knows, the discussions between Youngman and the bankruptcy administrators  are ongoing. No sale of nothing has been announced. Victor Muller’s and Vladimir Anntonov’s propaganda organ The independent enthusiast site Saabsunited implores the faithful:

“Don’t believe any report that shows up. The media is desperately looking for things to write about and comes up with, to say the least, strange news. Like with the rumours about Phoenix being sold to Youngman seperately we will try to figure out the truth behind it and keep you updated ad good as possible.”

To me, the story comes as expected. A few days ago, I predicted:

“I wouldn’t be surprised if a license for the PhoeniX platform won’t suddenly show up at Youngman, pledged as security for some of the money that had been paid. Then, GM will say that Phoenix IP is mostly theirs, and there will be a protracted and messy lawsuit.”

Whoever thinks the Chinese paid a few million out of the goodness of their hearts is gravely mistaken. The way we (and other Swedish media) understand the deal is that there was a loan, with the Phoenix platform pledged as collateral. Youngman most likely takes the position that the loan was defaulted upon, and the collateral is theirs. This can be a long, expensive, and messy lawsuit until this is sorted out, and in a bankruptcy, who has the nerves and money for that?

Ever since Steve Girsky an his “merry band of hatchet men” touched down in Rüsselsheim, Bertel has been warning that GM’s European division was about to embark on a serious cutting binge. But our worst fears, namely that Opel could go away entirely, have yet to be realized. Instead it seems that self-destructive mutilation will be attempted first, in order to stem the gushing red ink at Opel where at least €1b in losses are expected next year. Automotive News Europe [sub] reports that the first round of cuts will hit Opel’s Internationalen Technischen Entwicklungszentrum (ITEZ, “International Technical Development Center), as an IG Metall union document foresees some 1,420 product development position cuts (from a staff of some 6,000).

Opel’s spokesfolks insist that the union’s numbers are “factually wrong and excessively high,” but only, in the words of ANE, because they “include people who are not on Opel’s payroll – like employees of service providers and supplier employees.” Furthermore, the automaker has not offered an alternative number for the expected cuts, and given the close cooperation between unions and OEMs in Germany, not to mention the detail of the IG Metall leak (200 employees will be offered severance payments when 550 positions are transferred to the manufacturing engineering department from product engineering), it’s tough not to conclude that the number is fairly close to GM’s actual plans.

And the cuts aren’t limited to workers: a battery-powered version of Opel’s forthcoming “Junior”/”Allegra” city car, as well as a long-rumored Insignia-based Coupe are said to be on the chopping block as well… so let go of any plans to wait for a reborn Buick Riviera. Oh, and don’t hold out any hope for the “production potential” Opel recently touted for its strange, low-cost RAK e Concept. Meanwhile, here are the other measures that Opel admits are coming down the pike:

• Stronger concentration on the carmaker’s core development mission and a reduction in project coordination tasks

• Increased use of modules and construction kits. “For example, we still have too many steering and seating systems. We have to improve significantly here,” the spokesman said.

• Deeper and earlier integration of suppliers. “There are no plans to put a stranglehold on our suppliers — we need to increasingly rely on suppliers’ innovative strengths,” the spokesman said.

In short, it seems that in order to save Opel, GM has to kill off much of what made Opel so valuable to it, namely its ability to develop premium global vehicles for the parent company. Instead it seems Opel will be forced to concentrate on selling into a brutal European market that seems set to contract as the Euro crisis drags on. Perhaps there is some truth to the rumors that Chevrolet will slowly replace Opel after all.

After all, cutting engineer positions is certainly the low-hanging fruit in Opel’s restructuring, but GM will likely have to go after assembly capacity (likely at Bochum and Port Ellesmere) in order to address the overcapacity issues that are at the heart of its (and many European automakers’) woes. That could create problems though, as this latest union leak confirms that Opel’s labor councils are prepared to fight. Opel’s outgoing union leader Klaus Franz has gone so far as to ask GM to sell Opel to its Chinese partner SAIC, a move widely considered a sign that Franz was trying to move back in touch with an increasingly militant union rank-and-file in the face of his own legal problems. While Franz portrays himself as the victim of a media smear campaign and threatens legal action against the Frankfurter Allgemeine Zeitung, his union appears prepared to fight the seemingly inevitable production cuts. And all this as Opel celebrates its 150th birthday.

This week I will publish two reviews of the automobiles I drove over the last two weeks, and though neither of these cars are available in the US, I believe they both hold fascinating lessons that are highly applicable and relevant to both the US market and the global auto business. But in the meantime I thought I’d share this picture, which would be near impossible to take in the US, and which speaks volumes about the evolution of small cars. Just blocks from Paris’s Place de la Concorde, in front of Chanel’s flagship Parisian boutique, I was able to capture a classic and modern Mini, with a Smart ForTwo sandwiched in between for scale.

I’ll leave commentary on this image to TTAC’s Best and Brightest, but I will say that the tableau stopped me in my tracks. Though I’ve always loved the classic Mini, and I have only the deepest admiration for those who keep these wonderful cars in daily use, this image confirms just how much our automotive expectations have changed. If you think a Smart makes undue compromises in the pursuit of its city-friendly size, imagine what an original Mini must be like in today’s traffic….

After delegations of Pangda and Youngman had travelled to Trollhättan to inspect the factory, one returning Chinese traveler mentioned to a contact of mine that the factory is great, but it’s in the wrong place. In Sweden, workers would earn way too much and go home early, contrary to the Chinese worker, who would have a much higher work ethic for less money, the traveler opined. If all goes well (for the Chinese,) the Trollhättan factory will come to China. Usually well informed Sveriges Radio reports that Youngman is interested in buying the Saab assets in a bankruptcy sale.

Updated with Victor Muller’s press conference.

This interest has been confirmed by Hans Bergqvist, one of the bankruptcy administrators assigned to the case. What Youngman would be buying is a factory, free of obligations, but also free of any technology licenses and without the Saab name. According to Sveriges Radio, Youngman thinks that the current 9-3 does not need a nod from GM.

A Turkish company also appears to be interested. The Turkish embassy in Stockholm has established contact.

UPDATE: Victor Muller’s press conference can be seen below (courtesy: Saabs United)

Sweden’s Aftonbladet reports that Victor Muller filed for bankruptcy of Saab this morning at the court in Vänersborg.

Dagens Industri writes that with Saab having declared bankruptcy itself, the matter will be resolved quickly. A bankruptcy order is expected during the day.

The actual verdict had been handed down by GM over the weekend. GM refused to agree to any of the deals presented.

Today, the court in Vänersborg was scheduled to decide whether to lift creditors protection, which would have opened the doors to much messier bankruptcy proceedings. Over the weekend, Muller was in closed session with Rachel Pang of Youngman to hammer out yat another last minute deal. At one point, Rachel Pang became gravely ill, and unable to attend the court proceedings. After a little while and more talk, she regained her health. Now, any court appearances are no longer necessary.

Youngman had no other choice than to realize that without the cooperation of GM, the matter was way beyond salvage. This morning, Victor Muller reached into his hat, found it devoid of bunny-rabbits, and did what he should have done much earlier.

Both dealer group Pang Da and Youngman have sunk considerable amounts of money into keeping zombie Saab at least clinically alive. Wasting your own money is seen as a grave sin in China, and the disastrous end of the Saab adventure most likely will negatively influence foreign asset purchases by Chinese entities for a while.

Muller, his out-on-bail friend Antonov, and any Chinese suitors should have realized much earlier that GM had no interest in Saab’s survival if it would be at the expense of GM’s sizable activities in China. GM agreed to sell Saab to Muller because that spared GM the messy and expensive business to shut down Saab themselves.

As expected, Saabinistas vent their anger on GM’s Facebook page. Many vow to never buy a GM product. A hollow threat: Most of them are used-car drivers anyway. Case in point: Saab’s über-flagwaver Steven Wade. Before he sold Saabsunited to take on a (shortlived) PR job at Saab, he drove a 1999 Saab 9-3, canary-yellow. Wade is already bac k in Australia, looking for a job.

No.

GM has the rights to the technology in its hands, and without that technology, Saab is just a name. A name which Saab AB, the defense company, would like to get back as quickly as possible anyway. GM had said no to several proposals so far. The latest deal that had been cooked-up involves selling a subsidiary to China’s Youngman. Rather naively, Muller seems to think that this way, a cooperation of GM is not necessary.

GM is rather miffed by ”the various new investment/sale/loan proposals that have been floated by Saab in recent days, including statements that inaccurately suggest that the consent of GM is not required for them to move forward.”

Through is spokesman James R. Cain, GM made the following statement today, deliberately ”in advance of the hearing” on Monday:

“Saab’s various new alternative proposals are not meaningfully different from what was originally proposed to General Motors and rejected. Each proposal results either directly or indirectly in the transfer of control and/or ownership of the company in a manner that would be detrimental to GM and its shareholders. As such, GM cannot support any of these proposed alternatives.”

Something else will happen on Monday: The unions representing Saab workers will check the bank accounts whether the unpaid salaries have come in. No money, no support by the unions for a continuation of the reconstruction process, union representatives told the Göteborgs Posten. That money would have to come from Youngman. With the verdict from GM, Youngman would be crazy to pay.

Demand for new cars in the EU decreased by 3.5 percent in November, amounting to 1,030,414 units. Eleven months into the year, registrations stand at 12,157,119, that is 1.4 percent less than in the same period in 2010. Basically, the European market remains flat with a slight downward bias. This according to data released by the European manufacturers’ association ACEA.

The picture would look worse, would it not be for Germany. Germany was the only volume market to post growth (+2.6 percent). Downturn ranged from -4.2 percent in the UK to -6.4 percent in Spain, -7.7 percent in France and -9.2 percent in Italy.

From January to November, the German market expanded by 9.1 percent. In France (-0.3 percent), the UK (-4.5 percent), Italy (-10.6 percent) and Spain (-18.8 percent) , results were all negative.

New Passenger Car Registrations EU

All data can be retrieved here as PDF, and here as Excel file.

After enduring a rocky relationship with Saab’s management, Guy Lofalk is officially out as court-appointed administrator for the ailing Swedish brand. But although Saab boss Victor Muller had long hoped for Lofalk’s ouster, the news wasn’t all good for his slow-motion “rescue,” as Lofalk’s first replacement had to step down before he even began his duties. Reuters calls the abortive administratorship of Lars-Henrik Andersson  Saab’s “latest embarrassment,”  but TTELA reports that Andersson’s “defection [was] not based on a pessimistic assessment of Saab.” On the other hand, at least one of Andersson’s colleagues thinks he dropped out because Saab is “screwed.”

In any case Soderqvist seems to be the last remaining Saabtimist in Sweden, insisting he believes in the new plan to save the zombie brand, and he will serve as long as he continues to have faith… so what’s the new plan anyway?

JustAuto reports that

European supplier body CLEPA estimates up to EUR700m (US$910m) could be made available for beleaguered Saab to restart production, if plans by Chinese manufacturer Youngman and an unnamed Chinese investor bear fruit.

“That means [they - Youngman] will provide EUR200m and a financial investor will provide EUR500m – that will be enough to restart and give Saab a chance,” said [CLEPA CEO Lars] Holmqvist. “Youngman has already spent a lot of money, if nothing else to protect the investment they have already made.”

And where, pray tell, does this faith come from, that a Chinese bus manufacturer and an unnamed “financial investor” is ready to drop nearly a billion dollars on the auto industry’s most notoriously undead brand?

The CLEPA boss also revealed this week’s mood had swung from one of gloom to hope following his receipt of a bank statement indicating Chinese manufacturer Youngman had paid Saab EUR3.4m, believed to have covered overdue Swedish government taxes.

The supplier chief also detailed how Muller had been urged to declare bankruptcy in a bid to avoid any personal liabilities, but had resisted, a move Holmqvist endorsed.

“We have been up and down listening to Victor Muller,” he said. “On Friday I was quite pessimistic and on Friday night he [Muller] sent a copy of the statement slip that the money had been sent by Youngman.

“Then, on Monday, he was pressed by people around him to file for bankruptcy. They were afraid they would be personally responsible for debts. But he refused and he was right because the money arrived and he got a respite again. Another rabbit hopped up from the hat – I knew what was going on, but I did not think it was going to be in time.”

Where to start with this? How about the fact that €3.4m is hardly an indication that almost a billion bucks is forthcoming.. especially given the difficulties of transfering money from China? Or what about the fact that the transfer in question was for a transaction that Lofalk considered “a new obligation” (forbidden during reorganization), an accusation that was met with a claim that it was part of an earlier deal and intended for salaries, not taxes? The unknown identity of the “investors” willing to drop €500m on Saab? The fact that these investors, not Youngman, will control the brand (in order to keep GM happy)? The fact that US dealerships aren’t selling the cars they have, making a production restart largely pointless? In any case Holmqvist admits that his group stands to lose “a lot of money” if Saab goes bankrupt and is willing to back any plan (reality, it seems, notwithstanding).

The 16th was supposed to be the day that decided Saab’s fate, but the brand has been given another weekend to get the mysterious Chinese money into its accounts. A hearing is now scheduled for Monday, at which point cash (likely upwards of $60m) must be on-hand. An optimistic new administrator, and desperately credulous suppliers mean nothing if November and December salaries aren’t paid by then and the tax man is left wanting. Muller and his rotating cast of supporting characters are good at buying a week here and a weekend there, but that can’t go on forever. And the real tragedy is that all these delays have only made it more likely that Saab will die on the week before Christmas.

The Volt’s battery woes are having an effect on its European sibling. Automotive News [sub] reports that Opel/Vauxhall will delay delivery of the Volt’s sister-model Ampera, while investigations by U.S. authorities into battery fires following government crash tests of the Volt continue. An Opel spokesman told AN:

”We are not currently delivering the cars to customers while we set up the process to deal with these highly charged batteries to make sure they are safe.”

Opel had already started deliveries of the Ampera to dealerships in Germany, France, Switzerland, Belgium and Holland for y year-end launch. European sales of the Volt were officially kicked-off last week as two Amperas were delivered to the U.S. embassy in Paris.

Built with the Volt at GM’s Hamtramck plant near Detroit, the Ampera shares the Volt’s technology including the lithium-ion batteries. The styling is slightly different.

Meanwhile, even battery suppliers deem it necessary to keep a tweeting distance.

Swedens’ Dagens Industri has it from “several independent sources” that Victor Muller is ready to throw in the towel, and that Saab-owner Swedish Automobile NV will declare bankruptcy this afternoon at the court in Vänersborg. Dagens Industri has not reached Muller.

The usually well informed Sveriges Radio asked around and found nobody who could corroborate the story. SR found a few that say that nothing is in the bush.

One source told Sveriges Radio:

“It is not true at the moment. It depends on whether the Chinese are paying or not.”

Which brings us back to the mysterious transfer slip.

Asking around in China was likewise unproductive.  A “do you understand what’s going on at Saab?” was always answered with a “No, do you?”

Saabsunited breaks its self-imposed silent period (that didn’t last long), likewise cannot confirm the nasty rumors spread by the nasty Dagens Industri, but as a precaution says the fat lady in the dressing room is actually Twiggy:

“But even if it were to be true, please keep in mind that it is in no way the end of Saab. Several companies have risen out of bankruptcy and are today very successful! Lets wait and see what happens!”

Actually, we shouldn’t even mention Saab before the court in Vänersborg renders its verdict on Dec 16. The court will decide whether it follows the suggestion of the court appointed administrator Guy Lofalk to lift the creditors protection on Saab.  But it’s a slow newsday, and Saab is always good for a story.  No, we don’t mean the €3,322,993.13 allegedly transferred by Youngman. No, we are not referring to the latest round of hamfisted censorship at Saab’s enthusiast site. We are talking about a story that is making the rounds on websites that specialize on the activities of the Russian mob. They insist that Saab’s darling Antonov “has been involved in a number of financial scams before.” The mobster tracking site Rumafia says:

“A few years ago Antonov moved almost all Snoras’ liquid assets, $400-500 million worth, to foreign accounts. He disguised the fraud under a series of loans which the bank allocated to front companies with no real asset backing.”

Hmmm. No real asset backing?

The same site also alleges that the money to buy Saab from GM came trough dubious channels under hair-raising circumstances. Let’s join the story right after Antonov’s father was gunned down in Moscow:

“Alexander Antonov who received five bullets, remained the invalid. They were not going to come back to Russia any more, therefore they asked the chairman of board of “Investbank” Maxim Skachko and his assistant Igor Dubina to transfer abroad $400 million. Money transaction was carried out under the pretext of delivery of credits to various structures and without approval of board of directors of the bank. According to the Ministry of Internal Affairs of the Russian Federation, $200 million from this sum went on acquisition of motorcar giant Saab. Officially firm Spykers Cars became its buyer, 30 which % of actions belong to Antonovym.”

We don’t know whether these stories are true, but they are out there. Follow the links above, or peruse Google for a healthy dose of crime stories. We only quoted the tamer stuff to keep it SFW in case you are working over the weekend.

Now for the €3.3 million. Saabsunited today proudly presents a scan of a wire transfer instruction, in which Youngman tells its bank to wire €3,322,993.13 to Swedish Automobile Coöperatief  in Zeewolde, The Netherlands, via the Rabobank, SWIFT RABONL2U. The Coöperatief is the Special Purpose Vehicle that had been set up in September to put the unfinished  PhoeniX platform in hock. Back when, we wrote:

“Judging from the oblique language of the press release, this whole sale and licensing business is nothing else than a security for a loan that will probably be coming from Youngman.“

Administrator Guy Lofalk is taking the same position and reported to the court in Vänersborg that

“Saab Automobile AB incurred new obligations during the reorganization, in violation of the instructions given and the provisions of Chapter 2, § 15 Act on corporate restructuring.”

That’s a big no-no under Swedish law. Can’t be protected from creditors and pile on new debt. Saabsunited quickly defends the accused:

“This payment is part of a technology purchase made by Youngman Automotive Group from Saab Automobile which should help to pay salaries for the month of November. This technology purchase contract singled back in september. Of course this money is not enough to pay the complete salaries once it arrives at Saab’s accounts but it is one step on the way.”

How an innocent enthusiast website comes into possession of a wire transfer copy which usually is sent from accountant to accountant only to show that the funds are on their way remained anybody’s guess – - – until  Saabsunited Chief TimR proudly wrote:

 “It was sent from Martyn Shilte, CEO Spyker China to Guy Lofalk with a cc to people such as Rachel Pang and Kristian Geers at 10:30 on the 9th of december. I have seen the original e-mail with the original attachment!”

Consider TTAC in awe. We have never been on the CC: when wire transfers between international auto giants were confirmed. A superb piece of investigative reporting.

Sending the document to Guy Lofalk however was not smart. On the same day, Guy Lofalk asked the court to throw the book at Saab. With that, we’ll bid adieu from Saab until Dec. 16 (unless something interesting pops up).

PS: Advice from someone who routinely sends and receives bank wires in China: The wire instruction is worthless. You want to see the actual confirmation by the bank that the money was actually sent. As exhaustively discussed here, transferring money from China requires a certain amount of really red tape and extra documentation.

PPS: Due to the untimely passing of the page in question, we provide a link to the original document for the convenience of our readers. (Just in case the picture will be completely exorcised from SU’s computer, hat tip to Gruhm.) According to the metadata, the scan was taken retouched on 12/10/2011 at 10:24 AM with Photoshop CS4 Macintosh.  As for the original webpage,  unless a reader has a copy, it’s gone. Even the Waybackmachine has given up on Saab  - -  last picture taken on July 15^th 2011. Before, the archiving robot visited The Church Of The True Saab twice monthly. Advice from a dinosaur automotive propaganda operative: Crisis PR is a subtle art which is better left in the hands of trained professionals.

PPPS: I appears as if TTAC has picked up a good number of former (disappointed? disillusioned? shunned? banned?) Saabsunited readers. Make yourself at home.

December 16 is the day Saab’s fate will be decided. Court appointed administrator Guy Lofalk, who yesterday was ready to pull the plug, pulled it today. Currently, Saab is under creditor protection. However, Lofalk asked the Vänersborg District Court to lift the protection, opening the door to final bankruptcy. In a statement cited by Reuters, Lofalk said:

“Since the required funding has not been received and the stated schedule not been kept, the (Saab) companies lack the ability to pay upcoming liabilities.”

Lofalk also named General Motors’ unwillingness to approve proposed deals. GM had driven what looks like the final nail in the coffin, by denying the deal that was proposed a few days ago:

“We have reviewed Saab’s proposed changes regarding the sale of the company. Nothing in the proposal changes GM’s position. We are unable to support the transaction.”

GM appears to be unwilling to support any sale involving its technology, and without that technology, Saab is worthless. The proposed investors, including a Russian banker who had his banks taken away and who is out on bail, an alleged hedge fund of doubtful pedigree, and a Chinese busmaker, did not install much confidence.

The court in Sweden gave Saab and its creditors until December 15 to submit their opinions. A day after, the court will render a decision. Says Reuters:

“Ending protection from creditors would open the way for them to file for Saab’s bankruptcy. The court already has one claim, which is under suspension.”

Even at Saabsunited, the last bastion of optimism, the moral is sinking:

“Hope for the best, prepare for the worst.”

Automotive News China [sub] reports that “Saab Automobile AB is holding discussions with China’s Zhejiang Youngman Lotus Automobile and a Chinese bank over borrowing about 600 million euros (5 billion yuan) over two years.”

The source of that news is Victor Muller. Basically, what he is proposing is that instead of buying stock, the investment will be made as a loan, most likely secured by what is left of Saab. Good luck with that.

If Saab defaults on the loan, the lender would end up with a Saab shouldered with humongous legacy costs, and with no technology from GM.

Muller told Bloomberg he would need the loan in a “very few days” to avert bankruptcy.

In a very few days? A loan? From China? Is that Muller’s way to say: “It’s over?”