Saturday, February 21, 2009
Saab May Survive - or Not
As I'm sure I've mentioned, we are a Saab household. We still have our original Saab 900 that we bought the same year we got married, 1985. It was one of the quirky, personality-filled Saabs that were a cultlike favorite in the 1980s. Saab owners seeing another Saab on the highway would flash their lights.
The car above looks generally the same as our 1985; it's a 1986 (which was the same style). Our old girl has 250,000 miles on her and DH still drives her to Philadelphia 3 days a week. Right now the car does need a little work but still doesn't burn a drop of oil and still takes corners as if it is on railroad tracks.
Sadly, Saab lost a lot of its distinctiveness when it was bought out by General Motors. We had bought another 900 in 1991 (so for awhile had two nearly identical cars in different colors). But by the time we traded it in, G.M. had taken over the company and had already started their insidious mainstreaming of the Saab trademark. Our 2002 9-5 Sportwagon, while a very nice, serviceable car, doesn't have the same personality.
I've always been angry that G.M. didn't appreciate what it had in Saab. Saab was always an innovative company; they perfected their turbo and had gas-sipping 4-cylinder turbos on their high-end model while G.M. still relied on big V-8s that used lots of gas in order to get power. Saab's old motto was "the most intelligent car ever built."
By rights, given their legacy of innovation, Saab should have introduced the first hybrid vehicle to take this country by storm - not Toyota.
But G.M. had relegated it to a second-rate division among their many divisions and started trying to do the old productivity shuffle - putting Saabs on other platforms, mixing and matching styles. One low point came when they came out with the Saab 9-2 - a "Saab" that most Saab enthusiasts dubbed the "Saabaru" because it was really a Subaru that had been re-badged. But at least Subaru has a certain quirky and independent image of its own and they make good cars. The complete nadir happened when they came out with the 9-7 which was based on a G.M. SUV with a V-8 and lousy gas mileage. It was like the anti-Saab.
With the recent disaster that is the U.S. auto industry, G.M. has announced it will phase out Saab, Saturn and most of Pontiac within a short time as part of its restructuring. In aid of this, Saab has filed for bankruptcy in Sweden, in hope that the Swedish government will bail them out enough to make Saab attractive to investors.
According to the AP,
"With Saab, GM and the Swedish government are saying the other needs to come up with money to keep the brand going.
Preuss said $1 billion was needed to keep Saab operating, of which GM was ready to pay $400 million. The U.S. automaker had asked the Swedish government to guarantee the rest.
The Swedish government, which insists that Saab's survival is GM's responsibility, rejected the request because GM's business plan wasn't 'realistic,' Industry Minister Maud Olofsson said.
More capital is needed to construct a credible and sustainable plan, she said, and 'GM or someone else needs to provide that capital.'"
The New York Times has a more positive spin on the story, making it seem as if it was Saab's idea to go bankrupt and implying it might be successful.
"Saab went to a Swedish court for protection from its creditors, and said it would — with assistance from the Swedish government — reorganize to pave the way for private investors to buy all or part of the company.
After exploring Saab’s options, 'it was determined a formal reorganization would be the best way to create a truly independent entity that is ready for investment,' Saab’s managing director, Jan-Ake Jonsson, said in a statement.
Saab said it would need financing during its three-month restructuring 'from both public and private sources' and 'would continue to operate as usual.'
Elisabeth Thand Ringqvist, a spokeswoman for the Swedish industry ministry, said Saab would be eligible for help through loan guarantees provided to the Swedish auto industry as part of a support package the government approved in December.
'This could be interpreted as the government supporting Saab in the reorganization phase,' Ms. Ringqvist said. But she said guarantees for working capital, like what G.M. is seeking in Germany, were not on the table.
...dealers said they were optimistic about Saab’s future. 'It’s probably a great time for someone to get a bargain deal on a car company,' said Annette Adams, owner of Iowa City Saab.
Her dealership sells about 50 Saabs a year, while her husband’s Saab dealership, Saab Meyer Garage, sells a similar number.
She predicted Saab would thrive under new ownership. 'I look for good things to come,' she added. 'We just have to step across the hot coals to get there.'"
I hope it works and someone does step up to the plate and invest in Saab. I really would love to see Saab return to its roots under new owners who understand what Saab owners valued about the original Swedish Saabs, and bring that spirit back to the company.
As for Pontiac, that's another sad story. They too fell victim to G.M.'s propensity for making all their cars the same. I hope General Motors has learned its lesson or we'll be bailing them out again in a year or two.