#Youngman

Saab’s white collar employees were getting blue in their faces from waiting for last month’s paycheck. Saab had to sell off slices of the company to pay workers who sit at home twiddling their thumbs. According to the always well informed Saabsunited (when it comes to good news), salaries were transferred today at 5pm. On to the next payday.

Meanwhile, things don’t look so good in China. In June, Saab signed a non-binding memorandum of understanding (MOU) with Chinese distributor Pangda Automobile and car manufacturer Zhejiang Youngman Lotus. This had been feted as the second coming of Christ over in Flagwavingland. Put your ear on the ground. Hear that sound? It’s the Chinese, dragging their feet.

[Editor’s note: the initial draft of this piece misunderstood the structure of the deal. Youngman and PangDa have paid over $350m for a 51% of Swedish Automobile, Saab’s parent company (which has a market cap of $68m). Funding for the New Product Joint Venture (50% owned by Youngman, 50% owned by Swedish Automobile) has not been disclosed. See comments for more background.]

Just when the lights seem to be going out all around Saab, with employees calling for bankruptcy, suppliers in revolt and even the Swedish government pretending like nothing was happening, Saab always seems to find away to prolong the agony. Selling, then leasing back the factory was one step that’s been approved by the EIB. Getting the suppliers to take ten percent down on deliveries? Well, it turns out that management has some time to sort that one out, as the factory’s annual vacation starts in a week, and Saab is letting its employees go a week early rather than starting up and then shutting down the line. And the company is certainly hoping that it won’t have to restart the line simply to restore confidence, as it’s announcing the “final agreement” with China’s Youngman Auto and the dealer group PangDa for €245m (about $365m) which it hopes will clear up the perception that Saab is a sneeze away from death. Needless to say, this agreement fits squarely into the “stringing along” category rather than the “game changing” category…

Our friends at Saabsunited are slacking off. They used to have cameras trained on the Saab plant in Trollhättan that allowed them to (prematurely) report the return of the workers to the idling plant. Now they had to learn out of the press that the plant will remain closed for a few more weeks. From Reuters all the way to Car and Van Weeks, they all report that Saab workers will stay at home for another two weeks, or thereabouts. The negotiatations with the darned suppliers are ongoing. What else is new? Well, Saabsunited was able to provide the news that the news are true, and that “no definite date for a production restart has been set.” To make up for the temporary breakdown of communication, Saabsunited was allowed to listen-in on a conference call with American suppliers. However, they “can’t reveal specifics.” So why listen in at all? I know, the matter is getting old and tedious, but while we are at it …

So what are they saying in China about the Pangda/Youngman/Saab threeway? The blogs and message boards are full, of course. Cars are of high importance in CCC (car crazed China.) Much more important, what does China’s government say? Multiple agencies of the government will have to approve a deal with Saab. However, officials won’t utter a word before, often even after a deal is done or has been denied. But then, the government owns newspapers. Analysis of state media is a refined science in China. Let’s see some of it in action.

Strap on the man-pants, Saab fans, because there’s another heaping load of bad news for the Swedish brand this morning. First off, Saab’s mysterious Russian backer Vladimir Antonov has backed out of a deal in which he was to buy property at Saab’s Trollhättan plant and lease it back to the company, stabilizing its short-term cash position. Automotive News [sub] quotes an Antonov rep as saying

The property sale is now being discussed with external investors

Apparently the Swedish real estate investor Hemfosa has stepped into the breach and sources say a deal could happen quickly. Antonov’s man added that his boss was still interested in securing a shareholding in Saab, a move that has been awaiting approval by the European Investment Bank for some time now. But despite Antonov’s insistence that he’s not going anywhere, the real estate deal pullout is troubling. After all, if Antonov were really the Saab zealot he claims to be, willing to support and revamp the brand at any cost, wouldn’t he want to own the Trollhättan plant? Wouldn’t he want deed to the factory in case Saab, as it exists now, goes into bankruptcy? This is the first indication that Antonov is treating his Saab involvement as an investment rather than a crusade, which is frankly a bad sign for what’s left of the Swedish brand. On the other hand, with Chinese firms chopping up Saab, what’s a businessman to do?

The assembly lines in Trollhättan are still down and will be down for a while. With Spyker & Saab gasping for money, another Chinese party threw them a life line today. The price: Saab will be in Chinese control if and when all is approved.