The Truth About Cars » Müller The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Mon, 28 Jul 2014 17:04:35 +0000 en-US hourly 1 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » Müller U.S. Court Shoots Down Saab Suit Against GM Tue, 11 Jun 2013 12:29:40 +0000

When Spyker sued GM for mucking with Saab’s failed deal with Youngman, and wanted $3 billion for its trouble, TTAC’s resident garage lawyers did not give Spyker big odds.

Yesterday, the suit was thrown out.

A U.S. federal judge said the GM had the right to block the sale of a company using its technology, Reuters reports. Said U.S. District Court Judge Gershwin Drain said in a hearing in Detroit:

“General Motors had a contractual right to approve or disapprove the proposed transaction. The court is going to grant the motion to dismiss the matter.”

Spyker Chief Victor Muller was in the court room. He did not want to say whether he would appeal. “We will be awaiting the written order and then we will assess,” Muller told Reuters.

The allegedly aggrieved entity was Saab and not Spyker. Saab went bankrupt, and its assets were bought by a murky Chinese entity. Spyker acquired the rights to sue GM. As usual, Muller did not use his own money. Back then, a Spyker press release said:

“Spyker has secured the financial backing required to see the lawsuit through to the end from a third party investor.”

More money down the drain.

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Hot Off The Presses: Youngman Might Also Sue GM Over Saab Tue, 07 Aug 2012 19:46:49 +0000

Bringing suit against GM for not letting Saab live another day could be turning into a popular sport. Lars Holmqvist, former head of Europe’s automotive supplier body CLEPA, and as such an insider when it comes to the latest Saab dirt, says that spurned Youngman of China is also thinking of suing GM.

Yesterday, Victor Muller made headlines and invigorated the dwindling and already slightly despondent fan-base by filing a $3 billion lawsuit against GM for tortuous interference. Muller might be joined by Rachel Pang of Youngman, Holmqvist told just-auto.:

“Youngman is also thinking about suing GM. I know that. They have not made up their minds and, of course, they would be encouraged by Victor Muller’s lawsuit. I have information. I know from people…they are looking into the possibility. It is obvious because they spent SEK550m…securing the rights to the new platform.”

550 million Swedish Crowns is $82 million, and knowing the Chinese they absolutely HATE to see money spent for nothing.

Muller is using someone else’s money for the lawsuit, the identity is kept a secret. Holmqvist seems to know the financier, but he is not talking. What Holmqvist says is that the moneyman is not embattled Russian banker Antonov:

“It is not Antonov. Muller would not be stupid enough to trace anything back to Antonov. The whole Antonov story is finished.”

Holmqvist suggest not to take the legal maneuvering lightly, and he reminds us the Muller is smart and a lawyer. Granted, Muller definitely is a better lawyer than carmaker, but in the words on one of my former Manhattan lawyers who’s name is kept undisclosed to prevent him from being disbarred:

“Bertel, half of the lawyers lose.”



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Muller Gives Up, Files For Saab Bankruptcy Mon, 19 Dec 2011 08:29:43 +0000

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.

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Our Daily Saab: Unplugged Wed, 07 Dec 2011 16:38:49 +0000

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?”

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Pangda Starts NDRC Approval Process. Outcome Doubtful Mon, 23 May 2011 13:52:00 +0000

“There is almost no chance for the government to approve Pangda’s purchase of Spyker’s stake, let alone their plan to set up a new joint venture in China,” so said Zhang Xin, an analyst at Beijing-based Guotai Junan Securities, to Bloomberg. “The deal doesn’t fit in the government’s plan for consolidation.”

This came in reaction to Spyker’s and Saab’s announcement of today which proclaimed that “Pang Da Automobile (Pang Da) has entered procedure discussions with Chinese authorities, including the National Development and Reform Commission (NDRC), to obtain regulatory approvals for the investment in Spyker Cars and Saab Automobile.”

In the announcement, Victor Muller said:

“Based on our discussions with Pang Da we are confident that Pang Da will get the regulatory approvals needed to formalize the deal. I am very much looking forward to creating a strong business with Pang Da, initially in the distribution and subsequently in the manufacturing of Saab vehicles in China. What needs to be pointed out is that Pang Da’s advance payment and sales of imported Saab cars are not subject to approval from the NDRC. The first advance payment of EUR 30 million was received last Tuesday.”

Pang Qinghua, CEO of Pang Da, was a bit less ebullient:

“The initial procedure discussions we have had with the NDRC were done in good spirit and all parties have a good understanding of the process going forward. We remain convinced that we will be able to get all the necessary documentation and approvals to successfully complete the transactions.

Pangda is willing to buy 24 percent of Spyker and by extension of Saab. Pangda wants to pay 65 million euros ($93 million) for that share. “The latter step will require approval from Chinese authorities, something that may not be easy to get,” says Reuters.

On the Chinese side,“Pangda needs to persuade at least three government agencies — the National Development and Reform Commission, the Ministry of Commerce, and the State Administration of Foreign Exchange — that it can profit from the deal and contribute to state policy of making the car industry more competitive,” Bloomberg explains.

Also according to Bloomberg,

“Pangda’s Spyker stake requires the approval of Sweden’s government and national debt office, the European Investment bank and GM. The EIB, the European Union’s lending arm, is Saab’s biggest creditor with a loan guaranteed by Sweden. The debt office has yet to receive any application on Pangda’s proposal, said Daniel Barr, the official handling Saab’s case. A decision may take three or four weeks after a filing, Barr said. “

A manufacturing joint venture in China will take even more complicated approvals. Time is money, and Saab has neither in abundance. The €30 million probably are not enough to pay off current supplier bills. Dagens Industri estinates Saab’s supplier debts at between two hundred and four hundred million kroner, or as much as €44m. The cars for which the €30 million have been advanced need to be made. For that, some 800 suppliers need to be made whole first.

What’s more, Reuters writes today that if the share purchase or the joint venture “fall through, Saab will have to repay the initial 30 million euros.”

Analysts in China, who have a deeper understanding of Chinese business and politics than Saab fanzines, are convinced that the deal will not receive the necessary permissions. “The car industry needs strong quality carmakers making good-quality cars with the right price,” Scott Laprise, an analyst with CLSA Asia Pacific in Beijing said to Bloomberg. “We don’t need more brands. A lot of the small carmakers know they are in trouble because consolidation is going to happen.”

For years, the Chinese government has demanded consolidation of its highly fractionalized auto industry. The consolidation did not happen so far. There are rumors going around in Beijing that that current downdraft in car sales is government-engineered to force the weaker players to throw in the towel. Independent Chinese makers are much harder hit by the slowdown than state owned enterprises that are in joint ventures with foreign makers.

What the Chinese government definitely does not want is more car companies. What many overlook is that China’s government itself is up to its eyeballs in car companies, China’s central government owns several car companies. In addition, many large provincial governments are owners of a car company. Shanghai for instance owns SAIC, the company that builds Buicks that share the same platform that underpin Saabs. Beijing for instance owns BAIC, the same company that had turned down an offer to buy Saab (and the legacy that comes with it) in 2009 for a token amount. BAIC instead bought core technology and tooling from Saab in 2009. The government will think of its own car companies first before it will approve yet another one whose joint venture partner has trouble paying suppliers. Add to that the fact that Saab has very little to contribute in own IP (most is licensed from GM) and you will understand why the deal appears very unlikely from a Chinese perspective.


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Piech’s Privileged Porsche Plans Fri, 25 Jun 2010 14:17:46 +0000

Germany’s Handelsblatt received  rare access to the usually secretive Porsche patriarch Piech. The Chairman of the Volkswagen Supervisory Board has big plans for his family’s company once Porsche has been assimilated. Here is an excerpt from his list of Porsche Plans:

  • Porsche will get a smaller SUV, below the Cayenne, to compete with the likes of the BMW X5, Mercedes M-Class, but also with some Audi Qs …
  • Then, a planned Volkswagen sports car of unknown type will emerge as a Porsche. Nobody has approved this, but what Piech wants, Piech gets.
  • The hybrid 918 Spyder shall go in series production. If necessary, built by hand, and priced at €500,000. Piech wants it that way.
  • To make sure that Piech gets what he wants, his and Winterkorn’s confidante Michael Müller will definitely head up Porsche.

And what’s holding up an announcement of at least some of the plans? The state of Lower Saxony holds the famous 20 percent in Volkswagen, and Lower Saxony’s Premier Christian Wulff  will most likely be the next  President of Germany. (A job with less power than the Queen of England. The final say-so in Germany rests with the Chancellor, Frau Merkel.) When Wulff is elected on June 30, there will be a vacancy on the board. That will be filled by David McAllister, a good German with a British name. That needs to be papered first. Any grand announcements will not happen until this is done. But what Piech wants, Piech gets.

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Personnel Carousel At Porsche: Winterkorn’s Boys Take Over Tue, 22 Jun 2010 12:43:37 +0000

Management changes at Porsche. CEO Macht will be disempowered, or “entmachtet”, as the Germans say. „It becomes clear that Winterkorn will change out the top management at Porsche and will replace it step by step with confidantes from his inner circle,” writes Automobilwoche [sub].

Macht, a protégé of disgraced Wendelin Wiedeking, won’t be sent to Siberia. He will be “nach oben entfernt,” as the saying goes in Wolfsburg. He will be removed upwards. His new job will be production chief of all of Volkswagen, which gets him a seat on the Volkswagen management board. It’s not as glamorous as being chief of Porsche, and it’s a dangerous job, especially when VW sits at the bottom of the J.D.Power list.

Volkswagen’s current production chief, Walter Heizmann, will lead the truck business of VW, if Automobilwoche has it right. That comes close to Siberia by Wolfsburg standards.

And who will be the new Porsche chief, you ask? Good question. Automobilwoche says it might be Matthias Müller. The relatively luster-free chief of product strategy at Volkswagen is a member if the Winterkorn tribe. Three years ago, he followed Winterkorn from Audi.

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