It’s a sad day for Saabphiles, as GM announced – one week to the day before Christmas – that it has failed to find a buyer for Saab. It will begin winding down the Saab operation immediately.
There had been a glimmer hope for Saab earlier this month, as supercar maker Spyker stepped in as a possible suitor after similarly small sports car specialist Koenigsegg walked away from a potential deal in November 2009.
But GM admitted it could not viably sell Saab to Spyker – and no other bidders were forthcoming. Saab has reached the end of the road.
Why GM had to close Saab
Every passing week that the sale dragged on was a drain on GM’s finances. Saab has been bankrupt since spring 2009, lying under the protection of the Swedish courts. The negotiations to sell had proven so complex, and so time-consuming, that GM just couldn’t afford to fund the continuing operation while ever less likely suitors circled the bones of Saab.
‘Despite the best efforts of all involved, it has become very clear that the due diligence required to complete this complex transaction could not be executed in a reasonable time,’ admitted new GM Europe president Nick Reilly. ‘In order to maintain operations, Saab needed a quick resolution.
‘We regret that we were not able to complete this transaction with Spyker Cars. We will work closely with the Saab organisation to wind down the business in an orderly and responsible manner. This is not a bankruptcy or forced liquidation process. Consequently, we expect Saab to satisfy debts including supplier payments, and to wind down production and the distribution channel in an orderly manner while looking after our customers.’
What Saab’s closure means
The factory and headquarters in Trollhattan, Sweden, has closed. The operation had in effect been mothballed during the bankruptcy process, anyway. GM last week inked a deal to sell tooling for the 9-3, 9-5 and powertrain technology to Chinese firm BAIC, which is expected to sell these models in its domestic market.
Saab dealers will close, too – a similar fate that befell MG Rover outlets in 2005. GM has, however, promised to honour warranty work and spare parts supply.
CAR laments the passing of one of the most interesting mainstream brands in the motoring universe. Saab had a strong pioneering spirit in its heyday, leading the field in turbocharging, rallying, interior ergonomics and distinctive styling. But in recent years, GM’s ownership stifled Saab’s creativity and it was forced into the corporate straitjacket of what was the world’s biggest car maker.
Detroit – 18 December 2009
General Motors announced today that the intended sale of Saab Automobile AB would not be concluded. After the withdrawal of Koenigsegg Group AB last month, GM had been in discussions with Spyker Cars about its interest in acquiring Saab. During the due diligence, certain issues arose that both parties believe could not be resolved. As a result, GM will start an orderly wind-down of Saab operations.
‘Despite the best efforts of all involved, it has become very clear that the due diligence required to complete this complex transaction could not be executed in a reasonable time. In order to maintain operations, Saab needed a quick resolution,’ said GM Europe President Nick Reilly. ‘We regret that we were not able to complete this transaction with Spyker Cars. We will work closely with the Saab organization to wind down the business in an orderly and responsible manner. This is not a bankruptcy or forced liquidation process. Consequently, we expect Saab to satisfy debts including supplier payments, and to wind down production and the distribution channel in an orderly manner while looking after our customers.’
Saab will continue to honor warranties, while providing service and spare parts to current Saab owners around the world.
As part of its efforts to become a leaner organization, GM began seeking a buyer for Saab’s operations in January. Last week, Saab Automobile AB announced that it had closed on the sale of certain Saab 9-3, current 9-5 and powertrain technology and tooling to Beijing Automotive Industry Holdings Co. Ltd. (BAIC). GM expects today’s announcement to have no impact on the earlier sale.
As the company continues to reinvent itself, GM has been faced with some very difficult but necessary business decisions. The focus will remain on the four core brands – Buick, Cadillac, Chevrolet and GMC – and several regional brands, including Opel / Vauxhall in Europe. This will enable the company to devote more engineering and marketing resources to each brand and model.