The Truth About Cars » Victor Muller http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Sun, 13 Apr 2014 14:31:30 +0000 en-US hourly 1 http://wordpress.org/?v=3.8.1 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 editors@ttac.com editors@ttac.com (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 » Victor Muller http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com Tax Saabotage: Muller And Saab Board (=Muller) Target Of Swedish Government, Paper Says http://www.thetruthaboutcars.com/2013/05/tax-saabotage-muller-and-saab-board-muller-target-of-swedish-government-paper-says/ http://www.thetruthaboutcars.com/2013/05/tax-saabotage-muller-and-saab-board-muller-target-of-swedish-government-paper-says/#comments Thu, 30 May 2013 12:17:13 +0000 http://www.thetruthaboutcars.com/?p=490015 Victor Muller - Picture courtesy gp.se

Despite Victor Muller’s assurances that he is innocent, that he has not been accused of any crime, and that Sweden’s Economic Crime Authority most likely only wants to invite him for a friendly chat, Sweden’s  Göteborgs-Posten thinks it knows who is the target of the investigation:  Victor Muller, and Saab’s board. In the end, Victor Muller was alone on board.  Says the paper:

“From what Göteborgs-Posten learned, there is a clear link between the prosecutor’s recent suspicions about crimes by SAAB Automobiles former board and how Victor Muller was paid for his work from February 2010 to the bankruptcy in December 2012.”

“When Victor Muller, a major owner of Spyker Cars which bought SAAB Automobile in February 2010, joined SAAB’s leadership as chairman of the board, there was no written contract about how and for what he would get paid. Even so, invoices started to arrive from Muller’s companies in Latin America Tug Holding on the Dutch Antilles.”

An international tax consultant tells TTAC that disputes about consultancy agreements vs. salaries are common: “If there is a dispute, they ask first for a contract. If there is none,  bad news. If there is a contract, then they look for emails in which the contract was negotiated. If the contract just appeared out of thin air, bad news.  Then they look where the money went.”

According to Göteborgs-Posten, the money did not go to the Tug company, “but to Muller’s private bank account, as the investigations of the tax authorities show.” Apparently in a letter to Muller, those tax authorities worte:

“The evidence supports the conclusion that the purpose was that SAAB should give you compensation and that you would avoid paying taxes for this.”

Until SAAB’s bankruptcy in December 2011, about $1.2 million were paid in consulting fees to Victor Muller, the paper says.

“It was only in September 2011 that Victor Muller, when he was the only person in the leadership and the crisis in SAAB was escalating, that the consulting fees were regulated in a written agreement. The payments where thereby secured. 

The Tax Authorities sees this entire arrangement with consulting fees instead of salary for the job as chairman of the board as a ploy to make Victor Muller avoid paying taxes in Sweden for his work in SAAB Automobile. In September 2012 the Tax Authorities therefore decided to demand Victor Muller pay approx. 2 million SEK ($300,000) in tax.”

The paper concludes:

“The responsibility for errors in the conduct of SAABs accounting and reporting, and that SAAB paid a consulting fee instead of salary and that a substantial tax shortfall has happened, rests with the board of SAAB.“

In the end, Victor Muller sat alone on the board. On June 23, 2011, Saab’s General Counsel Kristina Gers stepped down from the board, a week after two union representatives defected.

In the meantime, Muller said through his favorite mouthpiece Saabsunited ,  that “the contract was approved by the National Debt Office  in 2010.” According to the information given to Göteborgs-Posten, no contract existed in 2010. The Debt Office told the paper that all it had to approve whether the “compensation was reasonable,” and that how taxes are paid would be up to Saab and Muller.

(Hat tip to a friend in  Sweden for a translation better than Google Translate.)
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Tax Saabotage: Swedish Economic Crime Authority To Question Muller http://www.thetruthaboutcars.com/2013/05/tax-saabotage-swedish-economic-crime-authority-to-question-muller/ http://www.thetruthaboutcars.com/2013/05/tax-saabotage-swedish-economic-crime-authority-to-question-muller/#comments Wed, 29 May 2013 13:29:39 +0000 http://www.thetruthaboutcars.com/?p=489944 Victor Muller - Picture courtesy coolbrandsstories.wordpress.com

Former Saab Chairman Victor Muller “will be called in to answer questions related to a Swedish inquiry into alleged tax offenses at the bankrupt carmaker,” Sweden’s  Economic Crime Authority told Reuters.

When news spread last week that Muller will be called on the carpet, Victor took to his favorite mouthpiece, Saabsunited, and said it is not true:

“Nobody from the Swedish Authorities has ever tried to get in touch with me and I am sure they have my number so if they had wanted to, they would have certainly been able to do so.”

Katinka Wall, a spokeswoman at the Swedish Economic Crime Authority, told Reuters that Muller would be summoned as part of the wider investigation and that he is not being served as a suspect.

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Tax Saabotage: Victor Muller Named As Suspect http://www.thetruthaboutcars.com/2013/05/tax-saabotage-victor-muller-named-as-suspect/ http://www.thetruthaboutcars.com/2013/05/tax-saabotage-victor-muller-named-as-suspect/#comments Thu, 23 May 2013 07:43:12 +0000 http://www.thetruthaboutcars.com/?p=489341

Muller and lawyer Geers in court – Both are suspects of tax evasion

As suspected, the Swedish Saab scandal  over avoided taxes grows wider.  Yesterday, it reached the failed takeover artist Victor Muller. “Muller prime suspect in Saab tangle,” headlines Swedens Svenska Dagbladet, The paper obtained court documents that say Muller is wanted for questioning.

“Victor Muller is going to be called into the Financial Crimes Unit,” Chief Prosecutor Olof Sahlgren told the paper.  Says Reuters:

“Prosecutors are looking into allegations that executives at Saab, which collapsed in 2011, obstructed proper tax checks over the years 2010 to 2011, a turbulent time for the company, when it was sold by General Motors to small Dutch sports car maker Spyker, and when problems which led to its collapse emerged.”

While Saab continued losing all the money given to Muller by shady Russian financiers  and the European Investment Bank, and while therefore no taxes on profits were due, the Swedish government wanted its rich share of payroll taxes and social contributions. As suspected by TTAC commenter Piffpaff, the Muller case appears to focus on consulting payments made to Victor Muller’s  Latin America Tug Holding NV (later renamed to LAT Management NV), based in the Netherlands Antilles, Svenska Dagbladet says.

According to the files and the Stockholm paper, some $540,000 were invoiced by Muller’s tugboat company in the tax haven. The prosecutor thinks Saab’s management should have paid taxes and social security contributions on Muller’s compensation. Invoices from entities in tax havens are a favorite tool for tax avoidance.

Prosecutor Sahlgren told the Dagbladet that Muller has not been formally charged with a crime. However, by law, Muller “is responsible for the company because he has been a director, president, and later CEO of Saab.”

The scandal could widen. According to the prosecutor, more people could come under suspicion. The matter also is likely to involve generous bonus payments made to Victor Muller when Saab was going down the drain. Unusually high payments to the boss, especially before a bankruptcy rarely fail to attract the attention of the prosecutor.

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Tax Saabotage: Three Former Saab Execs Arrested, Victor Muller’s Offices Searched http://www.thetruthaboutcars.com/2013/05/tax-saabotage-three-former-saab-execs-arrested-victor-mullers-offices-searched/ http://www.thetruthaboutcars.com/2013/05/tax-saabotage-three-former-saab-execs-arrested-victor-mullers-offices-searched/#comments Tue, 21 May 2013 15:15:27 +0000 http://www.thetruthaboutcars.com/?p=489134 Kristina Geers and Victor Muller Picture courtesy stureplan.se

During better times:Kristina Geers and Victor Muller

Key members of the board of bankrupt carmaker Saab were arrested yesterday on suspicions of tax evasion.  Former Saab General Counsel Kristina Geers, former CFO Karl-Gustav Lindstrom, and former CEO Jan Åke Jonsson spent the night in jail. After a serious grilling, the three were released today. At the same time, the offices of  Spyker in Zeewolde, Netherlands, were searched by police at the request of Swedish authorities, Z24.NL reports.

According to Saab fanzine Saabsunited,  the trio was booked on suspicions “of trying to seriously make accounting too complicated and difficult for the tax-authorities.” That alone does not justify an  arrest. Later, it was reported that the matter was about paying people as independent consultants instead as employees. This is a popular strategy to minimize tax and social security payments in many countries. It  usually starts a long discussion with the auditors, but no mass arrests, and no internationally coordinated raids. Someone seems to be fishing for more than confusing book entries.

Saab declared bankruptcy in late 2011. Their 2010 and 2011 books were audited, a normal procedure in most European countries after a company goes bust. During the bankruptcy, many suppliers were stiffed, however, the biggest loser was the Swedish government. It had guaranteed a $500 million loan by the European Investment Bank.

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Our Daily Saab: Banking On A Chinese Bank, Not Bank Of China http://www.thetruthaboutcars.com/2011/12/our-daily-saab-banking-on-a-chinese-bank-not-bank-of-china/ http://www.thetruthaboutcars.com/2011/12/our-daily-saab-banking-on-a-chinese-bank-not-bank-of-china/#comments Mon, 05 Dec 2011 09:18:09 +0000 http://www.thetruthaboutcars.com/?p=421425

Rumors that the Bank of China would be taking a role in the “rescue” of Saab turn out to have been something of a miscommunication. Saab explains the situation as it currently exists.

Swedish Automobile N.V. (Swan) announces it is in discussion with Zhejiang Youngman Lotus Automobile Co. Ltd. (Youngman) and a bank in China about an equity interest in Swan. The discussions include a short term solution to enable Saab Automobile to pay the November wages and continue reorganization. The outcome of the discussions is still uncertain. Any possible transaction would be subject to the approval of the relevant stakeholders. [emphasis added]

As always, you can read about the proposed new structure (which has PangDa out of the picture) and why it will solve all of Saab’s problems over at Saabsunited.com. But far more interesting is the English-language interview with Victor Muller, found here (skip ahead to the 38:40 mark), in which Muller explains that GM can block any deal in which an automaker takes a 20% or larger stake in Saab, and that he is essentially Vladimir Antonov’s front man. After all, trying to understand Muller is far more compelling than this latest deal, which can be approved by GM (because it keeps automakers below 20% ownership), but won’t actually solve Saab’s basic problems (for precisely the same reason).

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Our Daily Saab: Muller Losing Faith, Antonov Going Down http://www.thetruthaboutcars.com/2011/11/our-daily-saab-muller-losing-faith-antonov-going-down/ http://www.thetruthaboutcars.com/2011/11/our-daily-saab-muller-losing-faith-antonov-going-down/#comments Wed, 30 Nov 2011 19:09:42 +0000 http://www.thetruthaboutcars.com/?p=420806

A TTAC tipster sent us a Teknikens Värld  interview with Saab’s long-suffering would-be rescuer, Victor Muller, in which the eternal Saabtimist seems ready to admit defeat. In essence, he admits that GM is unlikely to ever approve a plan involving Chinese firms, that the Chinese firms are throwing “money into a black hole” and that all the previous plans are off the table. Of course, Muller does seem to think that some kind of rescue may yet be possible, but he admits

If I doze off Saab would disappear in an instant

If Muller is losing faith, and doesn’t even have a hairbrained scenario to hype, it seems that the end may well be near. But then, the whole rescue of Saab is beginning to be eclipsed by questions about Muller’s erstwhile partner, Vladimir Antonov, who was recently bailed out of British jail, where he was being held on charges of embezzlement and document forgery. But first, to the Muller interview…

The following is an interview titled “Muller Does Not Believe In Th Chinese”:

Victor Muller doubts that GM will ever accept a Chinese Saab business. According to him, Youngman, Pang Da and Guy Lofalk sabotaged the whole business when they went from the original plan. It says Muller in an exclusive interview with the Teknikens Värld.

On the way home from Britain hits Teknikens Värld Erik Gustafsson, an unusually outspoken Victor Muller. The gate at Heathrow Airport, the plane to Stockholm, he says frank about Saab’s situation.

- This is how it goes when you put his partner in the back, says Muller continues:

- The deal was long time and the arrangement with a Chinese shareholding of 54 per cent was approved. Then began administrator Guy Lofalk run government affairs, to persuade the Chinese to a 100-percent ownership stake and GM slammed on the brakes.

Late yesterday evening, Swedish time, had GM in Detroit, a further meeting on Saab’s future, but Victor Muller strongly doubt one acceptance.

- I understand GM fully, it is clear that they do not want to jeopardize its market in China. But right now I understand the other side is not why the Chinese continue to pump money into the company. As the situation is, it just means to put money into a black hole, without getting anything back. The relationship with GM is so damaged that they (Youngman and Pang Da) can not even go back to the original plan.

While he acknowledges that the situation is tough, he means that there is a solution. He can not tell you how it looks, but he promises to fight till the end.

- If I doze off Saab would disappear in an instant

Muller may still be fighting for Saab’s future, but as prosecutors unwind the Vladimir Antonov situation, Muller could soon be forced out of the process. After all, Muller is said to have a personal debt to Antonov of upwards of €100m, and it seems highly likely that Antonov was using Muller to launder funds embezzled from his Baltic banks. Antonov ‘s sports business has been placed into bankruptcy, and he has stepped down as Chairman of the British soccer team Portsmouth, reports ESPN. And Latvian officials seem to be clear on the Saab connection as well, as the Moscow Times reports

Latvian officials on Wednesday said about 100 million lats ($200 million) was stripped out of Latvyas Kraybank to fund Antonov’s investment projects, including the ill-fated Saab bid.

And the investigation is ongoing, as BBC reports that

[Lithuanian prosecutors] said they were investigating everything that might have links to criminal offences.

They added they would be taking “all the necessary steps” to freeze assets belonging to Mr Antonov and Mr Baranauskas.

It seems inevitable that this investigation will eventually catch up to Muller, at which point he’ll have to plead ignorance of Antonov’s alleged crimes. And even if Muller does escape prosecution, his ability to organize a deal to save Saab will be fundamentally compromised by his association with Antonov. And as Muller himself says,

If I doze off Saab would disappear in an instant

The countdown continues…

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Quote Of The Day “Bankruptcy Is No Option For Saab” Edition http://www.thetruthaboutcars.com/2011/10/quote-of-the-day-bankruptcy-is-no-option-for-saab-edition/ http://www.thetruthaboutcars.com/2011/10/quote-of-the-day-bankruptcy-is-no-option-for-saab-edition/#comments Fri, 21 Oct 2011 15:17:54 +0000 http://www.thetruthaboutcars.com/?p=415429 Lyssna: Saabs vd, Victor Muller, om företagets situation

Whenever a CEO says “bankruptcy is not an option,” you know the game is up. After complaining in this Swedish Radio interview (in English) that his court-appointed administrator is trying to sell Saab off wholesale to the Chinese, Victor Muller trots out Churchillian and Nietszchian calls to arms… in fact, he does everything short of bursting into a spirited rendition of “I Will Survive.” Unfortunately, Muller’s credibility is long gone, and he doesn’t help himself by trying to portray Lofalk as some traitorous backstabber. With Saab months (years? decades?) into its death-flails, and the most recent “rescuer” turning out to be a non-player, is it any wonder Lofalk wants to hand over the mess to the only viable companies involved (especially when Muller calls North Street a “strong partner”)? Muller continues to labor under two basic delusions: first, that he can sell a majority share to the Chinese while keeping Saab an essentially Swedish (or at least European) company and second, that anyone cares whether Saab becomes a Chinese company. Sorry Victor, there’s just nothing left here to fight for…

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Victor Muller Plays Maharajah While Suppliers Go Belly-Up http://www.thetruthaboutcars.com/2011/09/victor-muller-plays-maharajah-while-suppliers-go-belly-up/ http://www.thetruthaboutcars.com/2011/09/victor-muller-plays-maharajah-while-suppliers-go-belly-up/#comments Sun, 11 Sep 2011 11:59:33 +0000 http://www.thetruthaboutcars.com/?p=410859 Whenever we report about the machinations around Saab, the faithful remind us that there are real people affected. They are right. Some of the real people work for IAC for instance, one of Saab’s largest suppliers. Half of the production of its factory in Färgelanda went to Saab.IAC Sweden could be bankrupt in a few weeks because they don’t’ have the money to pay a 95 million kronor ($ 14.8 million) tax bill, Sweden’s Göteborg Posten reports.

IAC was one of the companies that agreed to a deal with Saab in May and started to deliver dashboards and door trim panels again. Today, they wish they had not.  Saab is said to owe IAC 73 million kronor, or some $11.4 million. That would go a long way towards settling the tax bill. When IAC, with their back to the wall, had agreed to the deal in May, they were feted by Saabsunited as heroes. Now, the company turns into a sideshow. Back in May, IAC had to let 200 people go, while Saab workers sat at home, collecting full salaries for doing nothing.

If IAC’s  tax bill is not settled by September 19th, the Swedish enforcement agency Kronofogden will come knocking , looking for assets that can be attached. “If they are unsuccessful, the tax office can request to take IAC bankrupt,” writes the Göteborg Posten.

All of this does not seem to worry Victor Muller too much. “Concerned about the impending demise of Saab? Apparently not for the top boss,” wrote the Dutch business newspaper Financieele Dagblad. “Victor Muller cruised along the small lanes in the Red Cross Rally in a giant yellow antique Rolls Royce once used by an Indian maharaja for tiger hunting.”

“You’d think that in such a time Muller has something else on his mind than a silly ride through the beautiful countryside,” said a fellow CEO of a large Dutch company.

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Saab: Antonov Considers EIB Lawsuit, While Questions Arise Over “Management Services” Money http://www.thetruthaboutcars.com/2011/07/saab-antonov-considers-eib-lawsuit-while-questions-arise-over-management-services-money/ http://www.thetruthaboutcars.com/2011/07/saab-antonov-considers-eib-lawsuit-while-questions-arise-over-management-services-money/#comments Fri, 29 Jul 2011 16:38:47 +0000 http://www.thetruthaboutcars.com/?p=404738
SvD.se reports that would-be Saab rescuer Vladimir Antonov is considering legal action against the European Investment Bank and the Swedish Government, for keeping him out of an ownership stake at the failing Swedish automaker. Says Antonov

I have therefore decided to investigate the possibility of taking legal action, including but not limited to claims for damages, which may be of interest to various parties, including myself, the EIB, some officials at the EIB, the Swedish government and some government officials personally. By denying SWAN (Swedish Automobile) and Saab Automobile access to the funding that I offer, what these companies want and still desperately want, both the Bank and the Swedish government acted against all involved parties concerned, particularly against Saab and SWAN’s employees , suppliers, traders, lenders and shareholders

Antonov is reportedly investigating whether he can sue individual ministers of the Swedish government, while the ministers in question angrily deny that they are working against the interests of the Swedish auto industry. Meanwhile, far from calling for the overthrow of the government, the Swedish press is investigating Saab’s outlays for “management services” in recent years, and has found that CEO Victor Muller may be siphoning cash off to the tax haven of Curacao.

Last year, Saab payed its owners at Spyker some 40m Kroner (about $6.3m) for “management services.” Of that portion, Spyker paid its CEO Victor Muller some $1.5m in compensation and bonuses… but that wasn’t the entirety of Muller’s payday. According to di.se, another $630k was paid to a mysterious company known as Latin American TUG Holding (recently changed to Lat Management NV), a firm that is registered in the tax haven of Curacao. Nearly $300k of that money was reportedly earmarked to Muller.

On 26 January this year the company changed its name to Lat Management NV The company is engaged in freight and shipping operations, and also provides “management services,” especially in the automotive industry, according to documents from the Curacao Chamber of Commerce.

Victor Muller’s name is not mentioned in the documents. Instead there are two Dutchmen as contacts and CEO – Everardus Van Rutten and Johan Van Vlit. They represent Lat Management’s local representative company – Coral Administration and Management. The company is in turn a freight company, which also has a business to register offshore companies in Curacao.

When di.se called Coral Administration and Management, we spoke to chief executive Johan van Vlit.

Who owns Lat Management N.V?

“I can not tell. It’s classified information,” he says, referring all questions about the company to Victor Muller.

But he confirms that the company Latin American Tug Holding changed its name to Lat Management NV In January this year.

One of the company’s activities is to provide “management services” in the automotive industry, are Victor Muller’s services provided?

“Well, it is he who does the job. But it’s better if you ask any questions to him, “said Johan Van Vlit.

When Saab is asked about the arrangement, Chief Information Officer Eric Geers is no more helpful.

Johan Van Vlit, representing Latin American Tug Holding NV, now Lat Management NV confirms to di.se that Victor Muller performs the company’s “management services”. What is your comment on that?

“I can not confirm it, but would need to examine it in this case. But if he confirms it as you may well take it. ”

Saab liabilities of Enforcement pile up and wages have failed again. Do you think that the payment of four million to Latin American Tug Holding last year was justified?

“I don’t know all the numbers. But we are in compliance with all accounting rules. There is nothing strange about that. ”

When di.se contacted Saab for further clarification, it reported that the $6.3m payment from Saab to Spyker was

payment for services performed by Spyker’s management of Saab’s behalf, including costs for the board. The payment also applies to the cost of various advisors and consultants paid by Spyker in connection with the acquisition.

But that would entail a few large staffs of consultants is not likely, according to the Dutch journalist Robert van den Oever, who has written a book about the Spyker and who have been following Victor Muller’s business.

“We know from earlier that Muller does not usually have a large group of advisers around him. He did not during the acquisition of Saab, nor in recent months as he has been working to find funding. It’s hard to believe that the costs of external consultants have been high, “he says, noting that Muller himself has said repeatedly that he works with a small group of people.

A Dutch shareholder’s rights group has already criticized Muller’s bonus arguing

The bonus is disproportionate. Given the large financial losses and poor sales, we wonder what objectives have been achieved that may justify a bonus

The fact that Saab can’t pay suppliers or workers while Muller is shuffling money off to Caribbean tax shelters (especially one so infamous that the Swedish government just concluded an agreement with it to crack down on tax evasion) is just one more piece of bad PR for a firm that’s pretty clearly circling the drain. And it certainly won’t help Antonov’s claim that he and Muller are as pure as the driven snow and the victims of discrimination. Muller has certainly done better out of the deal than anyone running a company that sold fewer than 30,000 cars last year has any right to expect… and he’s definitely done better than the employees he claims to be “saving.” Maybe it’s time for Muller and Antonov to just call it a day and pack it in.

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Trollhättan Official Calls On Saab CEO To Step Down http://www.thetruthaboutcars.com/2011/07/trollhattan-official-calls-on-saab-ceo-to-step-down/ http://www.thetruthaboutcars.com/2011/07/trollhattan-official-calls-on-saab-ceo-to-step-down/#comments Thu, 28 Jul 2011 21:57:23 +0000 http://www.thetruthaboutcars.com/?p=404674

SvD.se reports that Paul Akerlund, Saab’s former IF Metall (one of Sweden’s largest trade unions) representative and now Trollhättan Municipal Council Chairman, has called for the resignation of Saab CEO Victor Muller, saying

I do not think Victor Muller is a good president. He is an owner and a contractor, but he has not sufficient knowledge about how to manage production and development

And Akerlund is no city government busybody, but a longtime company insider who has been influential in Saab’s post-GM life. Having shepherded Saab through the challenges of the past two years, this is another grim sign that Saab is about to succumb to the realities that have dominated TTAC’s Saab coverage for years now. A commentary in SvD, titled “Thank Muller for Painful Bankruptcy” sums up the somber mood in Sweden:

[Saab] has been on artificial respiration for nearly two years. It is down now, and from all indications we can only conclude that the whole process was a painfully protracted bankruptcy. And we have only one person to thank for it.

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Saab Recasts Itself As Auto Industry’s Answer To Wal-Mart http://www.thetruthaboutcars.com/2011/05/saab-recasts-itself-as-budget-chinese-export-brand/ http://www.thetruthaboutcars.com/2011/05/saab-recasts-itself-as-budget-chinese-export-brand/#comments Tue, 10 May 2011 17:24:22 +0000 http://www.thetruthaboutcars.com/?p=394475

Saab has started paying suppliers again (although production hasn’t restarted yet), and CEO Victor Muller is once again all popped-collar confidence as he dismisses the “speed bump” that he blames on negative publicity. But behind Mueller’s yacht-club breeziness and talk of “true Saabs,” major changes are afoot in Saab’s business model. Saab’s deal with Hawtai, the product of a desperate search for support in the midst of a liquidity crisis, has changed how Muller sees the global car business, and as a result he’s shopping what may be Saab’s last meaningful asset: Western dealerships. Muller explains his thinking to Automotive News [sub]

We laughed when the Japanese came. We laughed when the Koreans came. But we will not be laughing when the Chinese come. The Chinese are like a steamroller. It took 67 years to build up our dealer network. It is the biggest asset not on our asset sheet, and these guys buy into it for free. If they make the proper cars, can you image how much simpler it will be to push product through the distribution network that is already there? It is like a railway network that is already there.

Bertel and I have a running bet about whether the first actual Chinese import to the US (not a converted glider) will be a Chinese brand or one of the western brands… but it’s not much of a bet because neither of us can ever commit to picking one brand that seems most likely to bust America’s Chinese car cherry, and our “bets” change on a weekly basis. In any case, though, think it’s safe to say that neither of us saw Saab as playing much of a role in any of the scenarios we’ve discussed.

Regardless, Muller’s attitude towards the Chinese industry is something akin to a sailor on shore leave, with a “come one, come all” approach to dangling its dealer networks in front of the entire Middle Kingdom. That’s right, Saab and Muller are in the general-purpose Chinese car evangelism business, rather than being tied up in some kind of exclusive deal with Hawtai.

Asked if this would be a vehicle produced by Hawtai, Muller said “there are 120 companies” in China. Saab would be interested in “the one with a strategy,” he said.

And what about branding? Will Saab be careful to pick only the safest, most upscale Chinese cars and brands to sell at its struggling dealer network?

Muller said the first Chinese cars sold here likely would not receive a 5-star safety rating. But he expects a low price would attract buyers.

In China “you can get a $10,000 SUV with air conditioning and electric windows, everything that was ever invented for a car. Do you really worry about a five-star (crash rating)? They look good,” he said.

Sweet. So, rather than using Hawtai’s ridiculous diesel engine production overcapacity to re-cast Saab as a diesel-first, Euro-niche maker, Saab’s struggling dealer base is being dangled as the automotive industry’s answer to Wal-Mart. Sure, there will be a day of reckoning when the Chinese start selling cars in the US, but many of the more legitimate Chinese OEMs have acknowledged that their products aren’t ready for the US yet. Chinese automakers who are tempted by Saab’s siren call of US-market exports should beware: with so much popular suspicion and antipathy towards China here in the US, a premature launch of not-ready-for-primetime products could set the entire Chinese industry’s US market ambitions back by years. Plus, you’d have to go into business with Saab. We’d suggest sitting this one out.

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Saab-Spyker Is A Hot Mess http://www.thetruthaboutcars.com/2010/04/saab-spyker-is-a-hot-mess/ http://www.thetruthaboutcars.com/2010/04/saab-spyker-is-a-hot-mess/#comments Fri, 09 Apr 2010 19:06:58 +0000 http://www.thetruthaboutcars.com/?p=351924

Where to start with Saab-Spyker CEO Victor Muller’s plans for world domination? Why not with the craziest part? Despite declining sales, the boutique supercar arm of Saab-Spyker claims to be developing a “Super Sport Utility Vehicle” in the mold of the D12 Peking-To-Paris showcar. Autoinformatief.com caused quite a stir when it revealed images of both a clay model and a test mule for this allegedly production-bound (yes, again) piece of madness. Moreover, news that Spyker won’t be invited to use Audi engines in forthcoming models caused at least one popular car blog to run the headline “Spyker’s New Ferrari-Powered SUV.” Because apparently Spyker can’t decide if it wants to use an AMG engine or a “supercharged Ferrari V8.” Does this give you a taste of just how goofy things have become ’round Saab-Spyker way? Well, it gets worse.

On to the Saab-flavored crazy. The boutique mainstream-model arm of Saab-Spyker is brimming with big plans, but before we get there, let’s take a moment to acknowledge just how disastrous Saab’s sales have been thus far. In the first quarter of last year (which was by no means the best sales year for Saab, at about 40k units globally), the Swedish brand sold 2,932 units in the United States. In the first quarter of 2010, Saab has sold a grand total of 813 units, with sales in March falling to a paltry 133 units. Yes, way.

But don’t worry, because Muller has the sales thing all planned out. He explains to Forbes:

I’m looking at our sales figure since we did the acquisition. We are looking at more than doubling our sales this year. We went from making 20,000 cars and selling 39,000 cars last year. This year we will be making 50,000 to 60,000 cars and selling all of them. So we are looking at a massive increase compared to last year. And next year, we should be back at the 100,000 car level.

But never mind the facts, this is the car business. Saab is upping production 18 percent, though even the Swedish government won’t buy their cars due to “dubious resale value.” And it’s not just the cars that came already-developed by GM that are grabbing headlines. A “retro-styled,” “teardrop-shaped” baby Saab has been rendered and written about extensively, even though Saab-Spyker’s business plan is about $1b short of making it happen (and that’s assuming an Opel Corsa basis). But hey, at least Victor Muller knows what he would name it.  And since Saab really is a big, grown-up car company, it must also have its own tuning arm, which will definitely be named “Viggen.” Every future Saab will be available in Viggen trim, doncha know?

So where is the money coming for all this? Russia, apparently. The more interesting question is what does Vladimir Antonov think he will get out of dropping $100m or so on a zombie brand, a money-losing supercar maker and their overly ambitious chief executive’s dreams of greatness? An insight into that comes from a translated Moscow Times interview with Antonov, by way of Saabs United. It’s a bit muddled, but apparently Antonov dreams of an auto empire of his own. A Russian unit building cars in Kalningrad that will apparently offer “Mondeo size at Focus prices.” A “Chinese unit” is planned as well, probably through an alliance with BAIC, which owns the IP to expired Saab 9-3 and 9-5 models. And Antonov makes it clear that Saab-Spyker isn’t a vanity project:

In fact, we have today is quite large [exposure] at Spyker. She lives in accordance with the business plan, Spyker, and repayment schedule, which arose long before the Saab on our horizon. Accordingly, these loans must be serviced, loans must be extinguished in accordance with this schedule. This is normal, this relationship “bank-client”. Spyker have always had relationships with the banks under the scheme is built. He was never, as they say, a favorite client, your customers. Just client.

So where is this ship of fools going? Who freaking knows. But it sure will be fun to watch. If nothing else, we have an excellent picture of the best-case scenario.

UPDATE (sort of): The new 9-3 will be built on the same Epsilon platform that has underpinned it since 2003… see what where this is going?

spykerd12a spykerd12c Zemanta Related Posts Thumbnail mulessuv Saab9-2 spykerd12b modelssuv spykerd12 ]]>
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Saab-Spyker’s Success Plan: New Cars, Cheaper Cars, And More Outlandish Cars http://www.thetruthaboutcars.com/2010/03/saab-spykers-success-plan-new-cars-cheaper-cars-and-more-outlabdish-cars/ http://www.thetruthaboutcars.com/2010/03/saab-spykers-success-plan-new-cars-cheaper-cars-and-more-outlabdish-cars/#comments Mon, 08 Mar 2010 21:40:28 +0000 http://www.thetruthaboutcars.com/?p=348139 With Russian financiers offering up to $100m to back the new Saab-Spyker project, it’s not surprising that the internet is awash with glad tidings of new cars from the new Dutch-Swedish venture. On the Saab side, CEO Victor Muller and company are teasing analysts with news that Saab is “already working on plans” for a new compact car, tentatively named 9-1. Having quoted Muller as saying the 9-1 had a “better than average chance”of being built (whatever that means), Automotive News Europe [sub] filled in the blanks:

[The 9-1] would be needed to help achieve Saab’s stated goal of closing the gap with BMW and Audi. Saab debuted a concept for an entry-premium car at the 2008 Geneva auto show. ANE sister publication AutoWeek named the 9-X BioHybrid the best concept at that year’s event.

First of all, nice pimp there guys. Also, too bad the guy who led design on the 9-X BioHybrid (and most Saab design work of late) has gone to work for Renault. Especially considering the rumors are swirling that a deal already exists for GM to supply Opel Corsa components to Saab for the vehicle, which would theoretically debut in 2013. Even though the 9-1 is not part of the as-yet not completely funded $1b development program announced by Saab, meaning more money would have to be raised to go beyond Muller’s current in-house scribblings.
But hey, let’s speculate about the extent to which the 9-1 will “resemble vintage Saabs” anyway. And why not. After all, touting 9-1 rumors is considerably better than speculating that the ultimate result of the Saab-Spyker deal might be a mid-engined, Saab-badged supercar. Or “reporting” that Spyker now “plans” to put its four-year-old Peking-to-Paris SUV concept car into production.  Or that the way to make this all happen is to cut prices on new models by 8-12 percent and not even try to mass-market.
Not that Muller is sweating any of it. As far as he’s concerned, he snagged himself a real live automaker for “the cost of a windtunnel.” Or, as he put it to caradvice.com.au:
This has all been given to us as a nice package, saying, ‘Good luck with it,’
Considering the recent history of Saab, isn’t it possible that this might not be such a good sign? Sometimes it’s hard to tell if hope dies last, or if sanity just dies first.
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Spyker Confirms Saab Sale Closure http://www.thetruthaboutcars.com/2010/02/spyker-confirms-saab-sale-closure/ http://www.thetruthaboutcars.com/2010/02/spyker-confirms-saab-sale-closure/#comments Tue, 23 Feb 2010 16:57:17 +0000 http://www.thetruthaboutcars.com/?p=346409

We are delighted – Saab’s future is now secure. From today we will be concentrating all of our efforts into reviving Saab and transforming it into a sustainable and profitable company with the confidence to be bold.  We will reinforce the emotional experience between Saab drivers and their cars and we will focus on Saab’s historical strengths in the fields of independent thinking, aircraft heritage, ecological performance and motorsport.

Through this acquisition we add approximately 15 euros per share in equity and 60 euros of assets.  With a well funded business plan in place we are looking forward to working with Saab’s management on the realization of that plan and bringing exciting new products to our customers. Real Saabs, Saab Saabs.

Spyker CEO Victor Muller celebrates the official transfer of ownership of Saab [full release in PDF format here]. GM’s release can be found here.

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Spyker Claims 2012 Profit Goal For Saab http://www.thetruthaboutcars.com/2010/02/spyker-claims-2012-profit-goal-for-saab/ http://www.thetruthaboutcars.com/2010/02/spyker-claims-2012-profit-goal-for-saab/#comments Tue, 02 Feb 2010 16:42:03 +0000 http://www.thetruthaboutcars.com/?p=343830

Spyker has set the goal of turning a profit with its newly-purchased Saab division by 2012, reports Automotive News [sub]. That effort will be led by a total of three Saab products: the existing 9-3 (with a new version rumored for 2011), the forthcoming 9-5 sedan and, later next year, the GM-built Saab 9-4X Crossover. Other models, including a 9-1 compact are being hinted at, but Spyker acknowledges that such a product would require about a billion dollars more than Saab-Spyker currently has access to. Meanwhile, those three vehicles will have to generate 100k-125k annual sales in order to keep the business plan rolling along. Saab-Spyker honcho Victor Muller has an almost shockingly confident take on this possibility, telling Reuters:

It’s all about the restoration of the confidence in the company. Customers have been very reluctant to buy because of the uncertainty surrounding the brand… Saab has to do nothing but regain its existing and old customers because that in itself would be in enough to create a very strong business model..

Saab sold a total of 8,680 vehicles in the US over the course of 2009. Globally, the firm sold 39,903 units last year, down from 94,751 in 2008. Perhaps the challenge is a bit more difficult than Muller lets on.

Muller says Spyker-Saab (the name change will become official on the 12th of this month) requires “peak funding” of about one billion dollars to complete its turnaround. $326m of that funding comes as development aid from GM, which will receive that amount in  redeemable preference shares in Saab. $400m is set to come from a European Investment Bank loan that, while guaranteed by the Swedish government, could still be rejected (for good reasons) by EU regulators. But the financial troubles don’t end there.

Apparently  $50m of $74m cash portion of the deal has been funded on a 50-50 basis by a loan from an investment vehicle of Muller’s, and shares predominantly issued to GEM Global Yield Fund Ltd for which it has received a €150m credit facility. Another $24m is due on July 15, but has yet to be funded. According to the company, “Spyker has been approached by various investors to fund this instalment. Spyker intends to finance this amount primarily through senior debt.” Saab-Spyker assets have been pledged to GM as security for this as yet unfunded final payment.

It’s not immediately clear when or how Muller intends his investment vehicle’s $25m investment to be repaid, and indeed this new investment vehicle is also raising concerns among investors. Spyker was required to buy out mobbed-up Russian plutorcrat Alexander Antonov before GM approved the deal, and this new investment vehicle was the way to get it done. But, Muller refuses to reveal who exactly is behind the fund, telling Reuters that a confidentiality agreement prevents such disclosure. This is being seen within Holland [via nrc.nl]as yet more evidence of Muller’s infatuation with risky, creative financing.

Under Dutch law, Muller’s ownership of over 30 percent of the new combined firm would require him to make a public offer within 30 days of the deal closing. Per Reuters:

although he did not indicate he would make a public offer for the company, Muller said his options include selling shares in the market, selling shares to an investor, or making a public offer for the company.

But he added any public offer would be made against the average price of Spyker shares over the past year and that investors would be unlikely to offer their shares at that price given that the offer price would be below the current market price.

Spyker shares, which debuted at €15.50 per share in 2004, had risen to about €6.8 last week, and have since fallen to about €3.5.

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Muller: Saab Bid “Serious As A Heart Attack” http://www.thetruthaboutcars.com/2009/12/muller-saab-bid-serious-as-a-heart-attack/ http://www.thetruthaboutcars.com/2009/12/muller-saab-bid-serious-as-a-heart-attack/#comments Thu, 24 Dec 2009 16:35:29 +0000 http://www.thetruthaboutcars.com/?p=340076

At least now we know how Saab will die. But Spyker CEO Victor Muller’s unfortunate choice of metaphors isn’t the only indication in his interview with the WSJ Deal Journal that Saab will die on the operating table. Take, for example, his answer to the question “Why does Spyker want to buy Saab?”

Saab has 1,100 dealers world-wide. If we sold Spykers in just 5% of those dealers, we would be tripling our distribution base. Saab also has access to technologies that would be ideal for Spyker, such as an all-wheel drive system. Also, a company that should sell 100,000 cars a year has very high purchasing power and get parts cheaper than a company that wants to make 100 cars a year.

Emphasis on wants to make 100 cars per year (they sold fewer than 50 last year). And yet, somehow Muller “hopes to model a Saab acquisition after Audi’s successful take over of Lamborghini in 1997.” Except that Saab ain’t Lambo and Spyker ain’t exactly Audi. Meanwhile, Muller also seems to think that Saab can survive on “quirk” alone, and he does some confused back-pedaling on his racially-charged statements about Saab and Spyker. The saga continues.

When Deal Journal asks how Spyker could improve Saab, Muller’s answer shows the yawning divide between the ultra-limited-production boutique automaker mindset, and the realities of the (even niche) mass-market business.

Saab is being carved out of GM and will have to stand on its own legs. In order to do that, it will require a completely different state of mind in terms of entrepreneurship. We are very entrepreneurial company. We manage to create Spyker out of nothing. The company hadn’t been active for 75 years when we started in 2000. We bring experience and branding and sales. I design all of my cars. Saabs would benefit from design input to make Saabs more “Saabish.” You buy a Saab for a reason. It is quirky. It is different. If you wanted a car that looked like everyone else you would buy a Volkswagen.

Yes, but Volkswagen also has Seat and Skoda. Meanwhile, what economies of scale would Spyker-Saab enjoy? If Muller were buying Saab from a bunch of well-moneyed fanboys, he’d be set. Unfortunately, “difference” and “quirk” don’t sell cars on their own, let alone build up the volume needed to compete in the market. But no matter. “I’ve read that you want to save Saab out of a feeling of kinship to Sweden,” suggests Deal Journal.

The Swedes and Dutch are very small nations. I have always admired the Swedes for their entrepreneurial ways. They have been able to thrive in a hostile environment. Go to Stockholm now and your toes freeze off. They have made very strong brands in Volvo and Saab. We have something similar in Holland. We are used to dealing with the climate. When I heard that Saab, an iconic brand was in trouble, I felt very strongly that we should help them out.

Climate? Charity? Can we just pronounce Saab dead before Muller starts waving a shiny balloon in its face and swearing that it sees signs of life?

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Quote Of The Day: The Worst Possible Reason For Buying A Car Company Edition http://www.thetruthaboutcars.com/2009/12/quote-of-the-day-the-worst-possible-reason-for-buying-a-car-company-edition/ http://www.thetruthaboutcars.com/2009/12/quote-of-the-day-the-worst-possible-reason-for-buying-a-car-company-edition/#comments Fri, 04 Dec 2009 20:30:05 +0000 http://www.thetruthaboutcars.com/?p=338129 Sigh. (courtesy:gtspirit.com)

It’s true, we [the Netherlands and Sweden] are small northern countries. We don’t have big German conglomerates to help us out. I just felt like we have to stand together because we’re the same people, we have the same DNA.

Spyker CEO Victor Muller explains his firm’s racially-charged interest in Saab to the LA Times‘ Dan Neil, while somehow managing to avoid any reference to Chris Bangle. Does this mean Muller is OK leaving Saab production in Sweden as a term for the European Investment Bank Loan?

Absolutely. As a matter of principle. The only truly authentic thing about a brand is provenance. The [Porsche] Boxster is built in Finland, OK, no problem. But could they be built in Mumbai? Sure, they’d be 20% cheaper but nobody would buy it.

Sigh. Given Muller’s soft spot for ethnicity-based branding and the sale of 9-5 tooling to China’s BAIC, we’re going to guess that the Saab-Spyker deal isn’t going to work out so well. [Hat Tip: Thor Johnsen]

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