I figured I better catch up with what’s happening in Saab-land.
It’s been a busy week with Youngman “pulling out” of negotiations to buy the company and a new company gaining momentum as a possible buyer. They say a week is a long time in either politics or football. It seems a lot can happen in a bankruptcy, too.
Reports are a little vague and they depend on which one you read; did Youngman jump or were they pushed from negotiations to buy Saab? Either way, they’re reported to be out of the picture. There are theories that Youngman were dismissed because they were too dependent on Chinese government approval, etc, etc. Let me pose my own theory based on a little prior knowledge and some educated guesswork.
Youngman were a mess of an organisation and my guess is that the administrators finally saw through their well-intended public statements and realised that they really are what they appear to be – a rabble. NDRC approval was never a concern as far as I can remember, so that’s just an excuse. Youngman are very well connected with the Chinese government and they’re in need of a company like Saab to justify all the G-money they’ve spent on empty factories back home in China. But they were also a bloody mess, which is why I’ve never favoured their bid to buy Saab. It seems the administrators finally think the same way.
I have to say that I’m pleased on Trollhattan’s behalf for their absence.
What’s Sven backwards?
It’s NEVS. And that’s an acronym for National Electric Vehicle Sweden.
NEVS is the new, emerging party looking to buy Saab with an eye to possibly making either/both hybrid and/or pure electric vehicles. At the top of the company is a former Volvo Trucks boss named Karl-Erling Trogen and another guy named Mikael Kubu, who’s said to have some history with insolvency and corporate reconstructions. They’re the front for some more Chinese and possibly Japanese money.
From Life With Saab:
“It’s not just about electric cars, but also about larger volumes of hybrid cars related to a long term development in electric cars,” a source said.
That tells me they’d be very interested in the work Saab did with eAAM on the rear-electric drive system that Saab were going to use in the new 9-3. They’ll need to be quick, though. eAAM is a business and I’ll wager they haven’t been hanging around, putting off talks with other OEM’s while Saab get their act together.
The big question is whether NEVS will also be interested in the new Phoenix platform (the 9-3 replacement) as well. I certainly hope so as it’s said to be a cracking design and mostly finished.
NEVS seems to be gaining momentum in the race for Saab with some suggestions the Swedish government favour their interest. This wouldn’t surprise me in the least, but don’t expect a flat-out statement to that effect.
Possibility and Stickability
The other big question that people are pondering in light of this consortium’s emergence is “Do I find the prospect of Saab owned by NEVS an exciting one?”
On one hand there’s a definite break in continuity here, which is a dampener. Whether they can build a link with Saab’s past will depend on the philosophy and hardware they choose to adopt. Will they be able to link up with Saab’s past vehicles to produce something ‘old’ whilst developing something new? Will they need GM’s permission to do so?
Any new owner is going to have to contend with incredible difficulties in terms of staff, dealer network, administration, marketing, engineering – and all of that’s before they make a single car. Even if there’s a small core of Saab personnel remaining within the wider organisation right now (and there is), this will essentially be a new organisation and they’re going to have a huge mountain to climb.
Personally speaking, whether it’s these guys who get Saab or Mahindra, I’m going to be happy to see a car company operational in Trollhattan again.
I’ll also be very interested in seeing the direction a new owner decides to travel with a new Saab. Will we all remain enthusiasts for the brand, or will we just attend conventions and festivals, remembering the good old days?
The answer to that question is going to boil down to the one thing that rules in the automotive industry – the product.
A new Saab will always have an engaged audience interested in what it’s doing, but as we all learned in 2011, that doesn’t guarantee anything. You’ve got to have the financial strength to survive the start-up phase, the distribution network to sell the cars and an advertising budget big enough to let everyone know that you’re alive. And the success and effectiveness of all that will depend on the product.
You can sell crap cars in the automotive industry – GM’s continued existence beyond the 1980’s is proof of this – but in today’s market and economic climate, you can’t continue selling them for too long. It’s all about the product, people, and the market will find you out eventually.
A decision on the ownership of Saab can’t be far away. It’s taken too long already. A lot of traditional Saab owners are replacing their Saabs with other brands right now. It’s the ownership cycle in action. I just hope they’ll keep an eye on what’s happening in Trollhattan over the next few years.