Thursday Snippets

A little more follow up to Jerry York’s speech the other day, where he advocated a massive cleanup for GM, including a recommendation to sell-off Saab.  Edward Lapham at Automotive News commends the speech as common sense, with one exception:

 There isn’t anything radical on the list or anything that hasn’t already been suggested by Wall Street analysts or other wags. Almost every point is a no-brainer, except maybe for the suggestion to whack Saab.

Can’t say I disagree.  Despite my longings yesterday for a Porsche buyout, those longings are reserved for a situation where Saab definitely is going to be sold off.  I still retain my line from a  few days earlier where I believe that it’s ultimately best for Saab to remain with GM and actually produce the models that are already in the pipeline. 

What Lapham has said here is correct.  There’s little in York’s speech that’s objectionable.  It’s good business sense, really.  And retaining Saab would be good sense too.  Saab have cut costs by a third over the last few years, will quite likely return to profitability in 2006 and are GM’s global premium brand.

But if they’re going to sell it, then sell it to Porsche   OK?

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The Financial Times online are talking about a Saab 9-1, which from the description given is the future model we’ve come to recognise as the 9-2.  I’ve posted here before about the need for an entry-level Saab model and it seems from this article that the 9-2 might be the one:

 The car could be built in much higher volumes than other Saab models and would further underpin the Swedish brand’s future and production facility in Trollhatten, said Mr Jonsson. With GM still suffering from over-capacity in Europe, the Trollhatten plant has no guaranteed production role for the group beyond 2010.

And further…

 Mr Jonsson, a Saab veteran of 30 years, acknowledged that Saab had been "inconsistent" in its brand image and that it had needed to "go back to our roots" as a maker of sporting cars.

Hear, hear! 

Thanks to Dr Apa for the heads-up. 

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2 Comments

  1. It seems so absurd to think that any company would be interested in Saab right now.
    And many would agree that money would be best invested in Subaru for example.

    But! And it’s one of those big long thoughtful beard stroking BUTS.
    Buying a share doesn’t mean you have control, and if you were a luxury sports car manufacturer.
    Would you potentially want to start watering down your Brand Image and start sharing synergies with foreign businesses?

    Now if we focus on why choose Saab.
    Is there any other motor company that has the potential to be desirable and profitable?
    The answer is yes. Jaguar and Volvo but there doesn’t seem to be the same sense of urgency as to the burden they have on their parent company.

    There is also the MM factor.
    Where maybe the only reason why Porsche has a new chief designer,
    is because Michael Mauer was left with no option but to leave if he did not want his creativeness to stagnate under a lack of finances from GM.
    I’m sure Mauer made many sketches that he would love to see come to life.

    The Premium Brand image that Saab has could be built upon so the two companies work for each other.
    No need for Porsche to built SUV’s and a 4Dr Coupe.
    And no need for Saab to build roadsters and mid-engine sports cars.

    Then there are the rumors of Saab and Porsche working together on a Boxter Diesel.

    They have been producing turbo engines for almost the same amount of time.

    They have good racing heritage.

    They both have niche market similarities.

    The more I think about Jerry York’s thoughts on GM and we are talking about when, as opposed to if he sits on the board. Then I think Saab’s days are numbered at GM.
    If the rumors are true of Porsche I can’t help but think that they could end up acquiring Saab by pure coincidence.

    Porsche owning Saab may seem odd,
    But think more like a mirror image of Ford owning Aston Martin.

  2. Hi WooDz – Just wanted to note that, at last reports, Volvo is not a burden to Ford, but rather the only part of the business making a profit other than financing services.
    And Swade, I share your desire for “a situation where SAAB definitely is going to be sold off” if you’re trying to say a “fire sale” situation is undesirable for SAAB and GM because the former could receive (even more) inappropriate ownership and the latter a very low price. Better to have a buyer with need or desire, though WooDz justifiably wonders “what company would be interested in SAAB right now”?
    Having heard from people with direct SAAB contacts last year that GM definitely wants to sell, plus confirming Swedish news reports, I’m confident the owner is “playing poker.” If GM management drop their poker faces and confirm wishes to sell SAAB, a low profit fire sale situation results. One alleged scenario, as I’ve shared here previously, is sale of the engineering and manufacturing pieces with GM retaining ownership only of the SAAB name. Despite GM layoffs, there are still great SAAB engineers, now working out of Opel sites in Germany. The remaining engineers — presumably the Creme de la Creme — would make a great addition to some aspiring car company or to an already great one like Porsche that hopes to expand its offerings. Yet, it sure would be sad to watch presumably rebadged Opels and Cadillacs scooting around with the SAAB emblem.

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