Saab Distances Itself From G.M.
By CARTER DOUGHERTY and MICHELINE MAYNARD
February 20, 2009
Saab, the Swedish automaker owned by General Motors, filed for bankruptcy protection Friday and asked the Swedish government for help in making it an independent car company again.
But it was unclear whether the government would step in to help Saab, in which G.M. bought a half interest two decades ago and assumed full ownership in the 1990s.
Separately, G.M. said that its German subsidiary, Opel, would need more than the 1.8 billion euros or $2.3 billion in loan guarantees that it had previously discussed with the German government. A reorganization plan for Opel — G.M.’s second-largest brand after Chevrolet — is expected by the end of next week.
G.M. said earlier this week that it wanted to cut Saab loose by 2010, as it tries to restructure. G.M. said in a report to the Treasury Department that it planned to end financial support for Saab by next year.
Saab went to a Swedish court for protection from its creditors, and said the company would — with assistance from the Swedish government — reorganize to pave the way for private investors to buy all or part of the company.
“We explored and will continue to explore all available options for funding and/or selling Saab, and it was determined a formal reorganization would be the best way to create a truly independent entity that is ready for investment,” the managing director of Saab, Jan-Ake Jonsson, said in a statement.
Saab said it would need financing during its three-month restructuring “from both public and private sources” but that the company “would continue to operate as usual.”
But it was unclear exactly what Saab was requesting. Elisabeth Thand Ringqvist, a spokeswoman for the Swedish industry ministry, said Saab would be eligible to receive help through loan guarantees that all Swedish carmakers can access as part of a support package the government approved in December.
“This could be interpreted as the government supporting Saab in the reorganization phase,” said. She added that guarantees for working capital were not on the table.
That is precisely what is at issue in the case of Opel.
Marco Molinari, director for finances at Opel, said in a statement Friday that a change in market conditions meant that the company needed more than the 1.8 billion euros in loan guarantees from the Germany government it had previously requested.
“To put an absolute number out there without having first clarified the contributions of other participants, including shareholders and employees, is not serious,” Mr. Molinari said.
The bailout for Opel is politically contentious in Germany, with politicians calling for strict conditions on the package. Some have even called for Opel to be taken out of American hands, but it is tightly integrated into the G.M. supply and technology chain.
Despite praise for the performance of its cars, Saab has been dogged by losses since 2001. The company lost about 3 billion Swedish kronor, or $343 million, in 2008 and said it would lose a similar amount this year.
Swedish officials have repeatedly resisted efforts to nationalize Saab, which came to life as part of the Svenska Aeroplan, a company founded in 1937 to build military planes. The first Saab cars were built after World War II. A separate company, also called Saab, still makes aircraft.
G.M. bought Saab in the wake of Ford Motor’s purchase of the British luxury car maker Jaguar. Saab, long known for quirky-looking cars with ignition in the floor and a griffin insignia, became a more conventional brand under G.M. It borrowed the underpinnings from some of Opel’s cars for its lineup, which includes sedans, wagons and a sport utility vehicle.
Given its Swedish roots, and ability to maneuver in snow, Saabs have traditionally been popular in the northeastern United States. But Saab is G.M.’s worst-selling brand in the United States, selling 21,383 vehicles in 2008, down 34.7 percent from 2007. Its best selling vehicle is the 9-3, of which G.M. sold just over 10,000 cars last year.