A couple of weeks ago the Wall Street Journal published an article about a “little-noticed” lawsuit in U.S. Bankruptcy Court filed by a trust representing “old” GM’s unsecured creditors. Those creditors are challenging a 2009 deal between GM Canada and a group of hedge funds that helped keep GM’s Canadian subsidiary out of its own bankrupcy. It’s a bit surprising to me that the WSJ article itself got very little notice in the automotive world because, if successful, the lawsuit could undo at least part of GM’s restructuring or result in a $1.3 billion price tag for the automaker. In regulatory filings GM has said its possible exposure will be less than that, $918 million, though in theory the bankruptcy court could reopen the entire bankruptcy, which would be much more disruptive to GM than just paying out a billion dollars.
“President Obama is proud of his bailout of General Motors. That’s good, because, if he wins a second term, he is probably going to have to bail GM out again.” Sounds like our august founder, Robert Farago, sounding off about
American Leyland the New GM. Nope, it’s Forbes this time, and they come to bury the General, not to praise him.
The most successful brands in our industry don’t have much meaning to them.
Toyota, Chevrolet, Ford, Hyundai, Kia, all of these are names that wouldn’t evoke much of any imagery had their manufacturers never existed.
Mercury and Saturn are popular planets that make you think of space and the futuristic pursuit of those faraway places. Acura should be quite accurate and precise. Rams are tough. Infiniti pays homage to the outer limits of capability and performance.
Yet all of these names experienced failure, or ultimately failed, due to the key essential ingredient within any brand’s reputation.
A lawsuit filed by a Florida investor against General Motors over the age-old practice of “channel stuffing”, or sending inventory to dealers and recording it as a “sale”, so that revenue numbers can be pumped up while the vehicles languish on dealer lots. The practice of channel stuffing is universal in the auto industry, but in this case, the consequences are much broader.
According to media reports and TTAC, all kinds of high-powered parties are interested in sucking the last bone marrow out of the corpse of bankrupt Saab. China’s Youngman supposedly is ready to plunk down a billion Euro (or $1.3 billion) for the carcass. In Turkey, Brightwell Holdings “will make a bid very shortly, there’s no question,” as Brightwell board member Zamier Ahmen told Bloomberg. The trouble is: Nobody is bidding. (Read More…)
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. (Read More…)
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.” (Read More…)
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: (Read More…)
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.
“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. (Read More…)
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.