By on November 15, 2011

Saab’s Memorandum of Understanding with PangDa and Youngman expired today, returning Saab to what must by now be a rather comforting, familiar state of limbo. Of course, the MoU in question was already dead, as GM had publicly nixed it, saying it wouldn’t supply parts or license technology to a 100% Chinese-owned Saab. But now, without an official agreement to rally around, Swedish Automobile, PangDa and Youngman are desperately pitching new ownership structures to GM in hopes of approval. Swedish Auto’s Victor Muller tells the WSJ [sub]

We are submitting an information package to GM and we will have to await the feedback that GM has on that package and then we’ll know.

Muller says the lesson of the failed MoU is that GM won’t accept Chinese control, and as a result the new proposed ownership structure is “very carefully crafted” so that none of the three partners has complete control. But since the previous deal, in which PangDa and Youngman would split a 54% stake in Saab, is also off the table, it’s tough to say what Muller’s “carefully crafted structure” entails. And while Saab and its Chinese suitors wait for GM approval that may never come (but don’t tell Keith Crain [sub] that!), it seems both time and money are getting tight. Again. Still.

Saab is refusing comment on how much cash it has on hand, but apparently the answer is “not much.” Automotive News [sub] reports that Saab’s payments to its US dealers, which includes money for warranty repairs,  have been delayed. According to a statement by Saab Cars North America,

While it is our intention to provide funding when it becomes available, you should use your judgment on whether to utilize these programs until SCNA is able to confirm funding is in place

But neither Saabs dealers nor its other creditors need wait too much longer for some resolution of this latest state of limbo. Saab has one week to come up with a plan to pay off its debts, or it could finally be pushed into bankruptcy. Failing that, Saab has salaries to pay again three days later (the 25th). If the company is screwing over its dealers and by extension its customers in one of its largest markets, it’s clearly at the “cutting off limbs to stay alive” stage. And that stage never lasts long.

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11 Comments on “Our Daily Saab: With Plans Expired And Dealers Waiting On Cash, GM Takes The Wheel...”

  • avatar

    I really wouldn’t drop dead of shock if Mr Muller pulled this off. To be fair to the guy he’s done a fantastic job of keeping Saab on life support this long!

    • 0 avatar

      You reckon? The writing’s been on the wall ever since Muller in desperation decided to involve the Chinese – from that moment on it was clear that the Saab saga would end in tears.

  • avatar

    How many more Swedish Chef episodes are there before the SAAB saga goes into reruns?

  • avatar

    No one but the Chinese wants it. What more can Mr Muller do?

    • 0 avatar

      Cut his losses and close up shop, for instance. That would be preferable to the inevitability of the Trollhattan plant eventually being closed and Saab production moved to China, no?

  • avatar

    So let’s say all this comes to fruition and SAAB starts making cars again, even new models, will there be enough sales to make a profit and keep it afloat?

    I don’t think so.
    If it was possible for SAAB to survive they would not be dying without the life support of GM and tax dollars. There is a quandary here that the value in SAAB is not profit from product but intellectual property that GM seems to protect. IF there is no Ip then what will we have, Chinese built SAABs based on current model forever? Like the brand new 1986 Cherokee sold for years in China?
    They have 10 days, a fortnight at most. That’s it.

  • avatar

    Let’s face it: if the Chinese would be allowed to give Saab the Geely-Volvo treatment, there may be a chance to survive, even to expand. GM, on the other hand, can afford to lean back and wait until some settlement is made that may actually be beneficial. Can’t blame GM.

    • 0 avatar

      Although… Saabsunited today mentioned financial troubles for Geely that “reportedly started to contact private domestic and overseas equity funds, such as Carlyle and TPG, for fresh funding, in order to repay Goldman Sachs for high-yield bonds. Most of these private equity funds are cautious about the request, due to their concern over Geely’s ability to repay.”

  • avatar

    Judging by what saab has done with the subaru platform (the upgrades suspension bits that subaru was jealous of), the 9-7x(is noticeably better than its gm cousins) and the re working of the gm ecotec, i think saab has more of a future as a tuner than as a car manufacturer. Its clear that they have the talent to work engineering magic, heck, they could design awd systems like they did for haldex. I think saabs power is in its engineers..

  • avatar

    Realistically Saab need to spend JLR levels of investment to save themselves I for one wish them luck but can’t see them surviving.

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