By on August 18, 2011

With debt collectors closing in on all sides, Saab’s shaky PR took another hit today as the Swedish media repotred that members of the board of Swedish Automobile (SWAN), Saab’s parent company, received pay increases of some 633 percent over 2010. reports that

New chairman of the board, Hans Hugenholtz, received a raise of 633 percent, from 147,150 kronor (about $23k) to 611,163 kronor (about $950k). Others also had their pay increased significantly.

Though the amounts are relatively small, and the dwindling ranks of unquestioning Saab supporters argue that the compensation is low compared to the Dutch average (SWAN is incorporated in The Netherlands), this is just the latest PR disaster to hit the struggling automaker. One Saab employee sums up the mood:

It feels like everyone is out to grab what they can get.

And no wonder they feel that way. Not only did worker paychecks arrive late, but Sweden’s national debt office has begun foreclosing on the first of its outstanding claims… and the initial amount (about $58k) could have been covered by the chairman’s pay increase alone. Sending the message that board compensation is more important than staying out of insolvency has to be some of the worst PR imaginable. Still, some will defend Saab no matter what…

Under fire from Swedish labor unions and media outlets, the Saab faithful are circling the wagons. The die-hards at Saabsunited are “sick and tired of the media in Sweden acting like teenaged girls spreading rumors etc.” and have posted “the facts” about SWAN’s board compensation (following the gameplan, as usual, of Saab’s own PR man):

1. By acquiring Saab, Spyker became almost 100 times bigger. With that follows responsibilities of the board members.
2. To be able to keep competent people on the board a company needs to pay them a certain amount when the company is at a certain size, this is very well known in the cases of Ericsson and Vattenfall in Sweden where even the swedish government has allowed compensations that were through the roof in the eyes of most people in order to be able to keep people and competence within the company. So now news there…
3. The compensations were raised retro-actively because of Spyker acquiring Saab on Feb 23, 2010 so the board had not been payed with the “right” amount when the job was actually done.
4. The board fees are paid by Spyker NV (Swedish Automobile NV) and NOT by SAAB…

To which I would respond:

1. Regardless of how big you are or have become, if you aren’t making money (or are having a hard time paying suppliers and workers), you shouldn’t be increasing board compensation.
2. It doesn’t matter how good Saab’s board is if there’s no money to pay workers and suppliers. A strong board ranks a distant third compared to the importance of these two groups which aren’t getting what they’re owed, let alone a pay raise.
3. Who cares? PR is all about timing, and the timing of this stinks.
4. This is a semantical distinction.

Please Lord, show some mercy: let this trainwreck be over soon!

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9 Comments on “Saab Board Pay Bump Sparks Union Anger...”

  • avatar
    DC Bruce

    Wow. The hits just keep on comin’

    To me, this is Exhibit A as to why Saab should be put out of its misery: The Board of Directors are out of touch with the reality that their company has to deal with.

    I’d also be curious as to what value this august group has added in the past two years. One of the traditional functions of a Board is to keep management “honest” (not in the sense of not stealing from the company, but in the sense of being grounded in reality and not deluded by unrealistic fantasies). This bunch seems to deserve a zero in that department.

    And, in the end, it appears that all they will have accomplished is left a bunch of employees and suppliers holding uncollectable due bills.

    Maybe they should pay these guys in Saab cars from its unsold inventory.

  • avatar

    Id like a public list of the board members responsible for sinking SAAB. Honestly they got paid so lets see it, lets see who was responsible for trashing a compnay while hording in cash! Exposure may not hurt them now, but it can come back right along with some karma.

  • avatar

    “147,150 kronor (about $23k) to 611,163 kronor (about $950k)”

    611163/147150=4.15 NE 633%
    950000/23000=41.3 NE 633%

    Just in case: 950000/230000=4.13 NE 633%

  • avatar

    The same thing happened when BMW spun-off MG Rover. The new managers and their inner coterie enjoyed a nice ride while it lasted.

  • avatar
    montgomery burns

    To be able to keep competent people on the board a company needs to pay them a certain amount when the company is at a certain size, Bla bla blaa

    Hilarious. So the line of reasoning is our company is tanking so we need to pay the management more.

    After being involved with management of multi billion dollar companies down to multimillion companies one thing is for sure: management spends an amazing amount of time figuring out ways to get more money from the enterprise for themselves.

    Here come the union bashers.

  • avatar

    Someone should save Saab, though. It probably would contribute more to humanity than say, Detroit.

  • avatar

    Saab styrelseledamöter är alla ass hål.|en|

  • avatar
    kid cassady

    The second figure is equal to $95,000 USD, not $950,000. With such a mistake, readers are liable to think that this is another Phoenix Four-style cut-and-run, which – though poorly timed – it clearly isn’t.

  • avatar

    Given the context, that picture made me laugh, I will give you guys that. Although it may sound naive for me to say this, it ain’t over. I fear you guys will be writing about Saab for a good while longer. Maybe I’m wrong. We will see.

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