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.


Distributorcap said...

and we wonder why GM is in the crapper - you sum it up so well -- corporate greed, arrogance and stupidity --- taking a gift horse and starving it to death

GM has made monumental bad decisions in the past 35 years -- mainly to insure bonuses for its execs - adn this is why they are where they are --- they can go around and say they get a bad rap =-- their cars sucks PERIOD.

when are people going to wake up and realize that we are in the mess we are in due to greed -- plain and simple. GM like all the others -- whatever profit was made, was never enough - it always had to be more

call me a socialist - i am damn proud of it


libhom said...

This is part of why merger madness must end, and antitrust laws must be enforced.

Reamus said...

Seems to me that a company that started out making very good jet engines should be saved in this mess...

kuanyin333 said...

Sorry it's taken me so long to get back here..Feb. has been a crazy busy month!

Saabs were always hard to get parts for said my friend who owned a Saab at one time, and yet, they were/are such beautiful cars! Hope they can make it through...

Comrade Kevin said...

Let's just hope that Volvos don't go extinct too.

In my opinion, the Big Three totally screwed themselves and need not be bailed out because of their hubris and incompetence.

Mauigirl said...

DCap, I agree. Unfettered capitalism just = greed. I worked at a very large company and have seen firsthand the efforts made to achieve "productivity" which usually meant cutting costs at the expense of the product. Thankfully I think they learned their lesson in recent years.

I am hoping this financial debacle may teach American companies a lesson; if you make a quality product, people will buy it; if not, they won't.

Libhom, I agree - too many mergers equals too many large companies that are too unwieldy to function well.

Reamus, exactly - Saab always had great technology - let's hope it can be restored.

Kuan Yin, here we don't have too much of a problem getting parts although for our old 1985 one we sometimes have to wait a few days for one to come in!

Kevin, agree - Volvo is another great Swedish car and I hope it survives.

Anonymous said...

Hi !.
You re, I guess , perhaps curious to know how one can make real money .
There is no need to invest much at first. You may begin to get income with as small sum of money as 20-100 dollars.

AimTrust is what you need
AimTrust represents an offshore structure with advanced asset management technologies in production and delivery of pipes for oil and gas.

Its head office is in Panama with structures around the world.
Do you want to become an affluent person?
That`s your choice That`s what you desire!

I feel good, I began to get income with the help of this company,
and I invite you to do the same. If it gets down to choose a proper companion who uses your funds in a right way - that`s the AimTrust!.
I make 2G daily, and my first deposit was 1 grand only!
It`s easy to get involved , just click this link
and go! Let`s take this option together to get rid of nastiness of the life

Anonymous said...

Hi !.
might , probably very interested to know how one can make real money .
There is no need to invest much at first. You may commense to get income with as small sum of money as 20-100 dollars.

AimTrust is what you need
The firm incorporates an offshore structure with advanced asset management technologies in production and delivery of pipes for oil and gas.

Its head office is in Panama with structures around the world.
Do you want to become a happy investor?
That`s your chance That`s what you desire!

I feel good, I started to take up real money with the help of this company,
and I invite you to do the same. It`s all about how to select a correct partner utilizes your savings in a right way - that`s AimTrust!.
I make 2G daily, and what I started with was a funny sum of 500 bucks!
It`s easy to start , just click this link
and lucky you`re! Let`s take this option together to get rid of nastiness of the life

Anonymous said...

You may probably be very curious to know how one can make real money on investments.
There is no need to invest much at first.
You may commense earning with a money that usually is spent
on daily food, that's 20-100 dollars.
I have been participating in one company's work for several years,
and I'll be glad to share my secrets at my blog.

Please visit blog and send me private message to get the info.

P.S. I earn 1000-2000 per daily now.

Anonymous said...

Hello everyone!
I would like to burn a theme at this forum. There is such a thing, called HYIP, or High Yield Investment Program. It reminds of ponzy-like structure, but in rare cases one may happen to meet a company that really pays up to 2% daily not on invested money, but from real profits.

For quite a long time, I earn money with the help of these programs.
I'm with no money problems now, but there are heights that must be conquered . I get now up to 2G a day , and my first investment was 500 dollars only.
Right now, I'm very close at catching at last a guaranteed variant to make a sharp rise . Turn to my blog to get additional info.

[url=] Online investment blog[/url]

Anonymous said...

Good day, sun shines!
There have been times of troubles when I didn't know about opportunities of getting high yields on investments. I was a dump and downright pessimistic person.
I have never imagined that there weren't any need in large starting capital.
Now, I'm happy and lucky , I started to get real income.
It gets down to select a correct companion who utilizes your money in a right way - that is incorporate it in real deals, and shares the profit with me.

You can ask, if there are such firms? I have to answer the truth, YES, there are. Please be informed of one of them: [url=]Online Investment Blog[/url]

Anonymous said...

Glad to greet you, ladies and gentlemen!

We are not acquainted yet? It’s easy to fix,
my parents call me Peter.
Generally I’m a venturesome analyst. recently I take a great interest in online-casino and poker.
Not long time ago I started my own blog, where I describe my virtual adventures.
Probably, it will be interesting for you to utilize special software facilitating winnings .
Please visit my web page . I’ll be glad would you find time to leave your opinion.