Saab Cars History

The Swedes at Saab were building planes long before they were building cars so you know their standards ran pretty because in the aeronautical industry there’s no room for mistake if you want to get back safely on the ground.

In 1937 the Svenska Aeroplan Aktiebolaget or the Swedish Aeorplane Company starting its business but by the end of WWII the good people down there had trouble placing their products on the market. A new market was needed, but for a new market you need a new product. And since the need to get people fast and safe from one place to another was on the rise, what better market than that of automobiles. So, in 1944, Project 92, or the manufacture of the first Saab car began.

The Saab 92 had a very interesting feature but it was an understandable occurence when you consider the man who drew up the car used to design planes: it had a very low drag coefficient of 0.31, one which many modern cars still struggle to attain.

After the Saab 92 came the Saab in 1955 with an improved engine, upgraded to 3 cylinders and with the trapezoid grille that would become a trademark for the brand in later years. A wagon version of the car, the 95 came in 1959.

In the 60s, the general direction for Saab was bigger, as the 99 model proved. It also brought in more power, as the 99 was turbocharged, a feature common on later cars as well, a tradition for the Swedish automaker from then on. At the end of the decade, Saab reached the 1 million cars mark.

A new platform was needed by the end of the 70s for the aging Saabs, so the company signed a deal with Fiat which later spawned the Alfa Romeo 164, Fiat Croma, Lancia Therma and the Saab 9000. All these cars rode on the Type Four chassis, the result of the joint venture.

Ten years later, in 1987, Saab found itself in financial difficulties and was forced to shut down the plant at Arlov in order to cut costs. The fact that GM bought 50% of the stocks in 1990 helped alleviate the problems a little, but the company was still losing money and so the factory at Malmö in order to further reduce costs.

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Recovery was going to come in the shape of the Saab 900, developed with the help of GM in 1993, a car which would give the company its first profitable year since the 80s. GM later acquired the rest of Saab’s shares as was the initial agreement and from then on Saab became subsidiary to the American giant.

 

The new close relationship yielded its first product in 2003’s all-new 9-3. The new model, marketed as a sport sedan, dropped Saab’s iconic hatchback in favour of a more conventional four-door approach. The model shared a co-developed platform (GM’s “global Epsilon 1 platform”) and some other components with the Opel Vectra again, but the relationship was much more of a joint engineering effort than before.

Under GM’s direction, the badge-engineered Saab 9-2X (based on the Subaru Impreza) and Saab 9-7X (based on the Chevrolet Trailblazer) were introduced in the American market in 2005 with the hope of increasing sales. Both models were a critical and commercial failure and were cancelled a few years after production began. GM also delayed the 9-3 wagon by three years, shelved a hatchback derivative of the 9-3 sedan, stalled plans for all-wheel-drive capabilities in Saab models until 2008, cancelled a 9–5 replacement in 2005, and announced a planned shift of production away from Saab’s historic home in Trollhättan to Opel’s factory in Rüsselsheim.

Owing to fading fortunes across its entire business, GM announced that the Saab brand was “under review” in December 2008, a process which included the possibility of selling or shuttering the car maker. Reportedly,27 potential buyers emerged, including BMW, Fiat, Geely, Hyundai, Magna, Renault and Tata Motors; serious talks progressed with three bidders: the Swedish supercar maker Koenigsegg, Merbanco and Renco Group.

koenigseggAs the talks progressed, GM’s support receded, and Saab went into administration, the Swedish equivalent of America’s Chapter 11 bankruptcy. Saab’s managing director Jan-Åke Jonsson said that this was “the best way to create a truly independent entity that is ready for investment”. For its part, the Swedish government was reluctant to become involved, with Maud Olofsson, industry minister, stating: “The Swedish state and taxpayers in Sweden will not own car factories. Sometimes you get the impression that this is a small, small company but it is the world’s biggest automaker so we have a right to make demands.”

On 16 June 2009, Koenigsegg announced its intention to purchase the brand from GM. The bid was backed by a group of Norwegian investors and the Chinese car maker Beijing Automotive Industry Holding Co Ltd (BAIC). The following month, both parties announced that GM had consented to the deal. There were outstanding financial details, but a loan from the European Investment Bank was expected to cover them. The loan was approved in October, but on November 24, 2009, Koenigsegg announced that it had “come to the painful and difficult conclusion that it could no longer carry out the acquisition,” much because of the constant delays and the difficulties coordinating the involved parties; GM, the European Investment Bank, the Swedish National Debt Office and BAIC.

It was announced on 14 December 2009 that the Chinese automaker would acquire the intellectual property rights and production equipment for the previous generation Saab 9-3 and Saab 9-5 in a deal worth about US$197 million, which was enough for the company to run for three months. BAIC expressed its intention to create a new brand around the purchased technology and admitted to the purchase of “three overall vehicle platforms, two engine technologies and two transmission systems.”

Following the collapse of talks with Koenigsegg, GM announced that the brand would be eliminated in 2010 if it failed to secure a buyer before the close of 2009. As talks with several firms failed, including the Netherlands-based boutique supercar maker Spyker, GM formally announced its intention to wind down the Saab brand.

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Undeterred, a new offer round materialized. Earlier bidders Spyker and Merbanco revised their offers and were joined by a submission from Luxembourg-based Genii Capital, which boasted the support of F1 chief Bernie Ecclestone. GM continued accepting bids until a self-imposed deadline of January 7, 2010. Acknowledging that the chances for reaching a deal with any party were very slim, they pledged to evaluate each offer with due diligence.

On 26 January, General Motors (GM) confirmed that Spyker N.V. and GM had come to an agreement allowing Spyker to purchase Saab, subject to regulatory and government approval; the sale was completed on February 23, 2010. General Motors would continue to supply Saab with engines and transmissions, and also completed vehicles in the shape of the new Saab 9-4x from GM’s Mexican factory. The deal included a loan from the European Investment Bank, guaranteed by the Swedish government. It comprised US$74m in cash up front, payable to GM by July 2010, and shares in Spyker to the tune of US$320m.

On February 25, Spyker Cars N.V. announced that it had agreed to sell the sports car arm to focus on Saab. Spyker intended to change its name, in May, to include the Saab name.

In early 2011 Saab began to run out of money, and Spyker were not able to cover the losses. Both companies stopped paying bills, and on March 30 several suppliers refused further deliveries to Saabs factory in Trollhättan. Initially Spyker CEO Victor Muller blamed the media for the problems, and claimed that Saab had no problems with funding. On April 5 all production was halted at Saabs plant in Trollhättan.

Spyker CEO Victor Muller tried to obtain funding from several different sources. On March 30 his former sponsor, Russian banker Vladimir Antonov applied to Swedish authorities, EIB and General Motors for permission to become a shareholder in Saab. His request was denied by the EIB, citing concerns about his businesspractices.

On May 3 a joint venture between Saab and Chinese carmaker Hawtai was announced. This deal quickly unraveled and on May 12 Hawtai walked away from Saab.

Plans for a new joint venture with Chinese carmaker Youngman and Chinese automotive retailer Pang Da followed shortly. After months of negotiations the companies agreed to a joint US$140 million takeover of Saab Automobile and its UK dealer network unit from Swedish Automobile, with Youngman and Pang Da taking 60 and 40 percent stakes respectively.

On 6 December, GM announced that it would not continue its licenses to GM patents and technology to Saab if the company was sold to Pang Da and Zhejiang Youngman, stating that the new owner’s use of the technology is not in the best interest of GM investors. Because of this, Saab started working on a new proposal which would not change the original ownership structure and would not include a Chinese partner as an owner of the company, but instead as a 50% owner of a new daughter company.

On 19 December 2011, with no alternatives left after GM continued to block any form of involvement with a Chinese partner, Saab officially filed for bankruptcy after a three-year fight for survival. Under Sweden’s bankruptcy laws, a party that files for bankruptcy can be bought out of bankruptcy.

On 16 April 2012, a meeting on Saab’s bankruptcy was held at the District Court of Vänersborg. The official receivers in charge of the Saab liquidation valued the assets at us$500m and the debt at US$2,000m. After subtracting the value of the assets, Saab leaves a debt of US$1,500m.

 On 6 August 2012, Spyker, represented by the law firm Patton Boggs, filed a lawsuit against General Motors in the United States District Court of the Eastern District of Michigan claiming US$3 billion in damages for the actions GM took in the fall of 2011 to stop the various proposed deals between Spyker and Youngman concerning Saab Automobile where Youngman claimed to be ready to invest several billion dollars in Saab Automobile to guarantee its future. More precisely, under the Automotive Technology License Agreement (ATLA) between GM Global Technology Operations Inc (GTO) and Saab, GM refused licensing of the platforms and technology in Saab cars if any Chinese party were to be involved in Saab’s ownership structure.

To solve this issue, Spyker and Youngman came up with a deal where Youngman would provide Saab with a loan of €200 million which would be converted into an equity interest in Saab only after Saab ceased using GM technology in its vehicles. Despite this, GM maintained that it would still refuse licensing of platforms and technology needed for production of Saab cars in Trollhättan and also threatened to cease 9-4X production at GM’s plant in Mexico, should the deal go through.

Consequently, the deal finally collapsed and Saab was forced to file for bankruptcy. According to Spyker, the actions taken by GM were not legal. Since Saab had been in receivership since the bankruptcy, and would be until the deal with Nevs was closed, Spyker and the receivers of Saab Automobile had entered into an agreement where Spyker would bear the costs of the litigation in exchange for 90% of the claim if the case is successful.

In June 2013, the district court dismissed the lawsuit, ruling that General Motors was within its rights to block the sale. In October 2014, the district court of appeals upheld the dismissal.

Nevs

On 13 June 2012, a press conference was held announcing that the main assets of Saab Automobile AB and its subsidiaries Saab Automobile Powertrain AB and Saab Automobile Tools AB as well as the Saab factory had been acquired by a Chinese consortium called National Electric Vehicle Sweden (NEVS). Saab Automobile Parts AB was not included in the deal and the Swedish National Debt Office would continue as an owner of that company. Nevs’ plan was to build only purely electric vehicles with an electric version of the current 9-3 model available in 2013/2014, as well as to continue development of the replacement to the 9-3, the Phoenix. GM continued to refuse licensing of the technology in the Saab 9-5 and 9-4X, so these models would not be produced. The rights to use of the Saab trademark had not yet been granted by Saa B AB and Scania AB and negotiations on that matter continued.

On 26 August 2012, Scania AB let the Swedish press know that the griffin logo used in both Scania’s and Saab Automobile’s trademark would not be allowed for use on future Saab cars with Nevs as the owner of Saab Automobile. Scania believed the logo is of high value in China and feared that it would end up in the wrong hands through the Chinese interests behind Nevs.

On 3 September 2012, Nevs announced that it had finalized the acquisition of Saab Automobiles assets. Nevs would be able to use the name Saab on future cars but not the griffin logo. Production of the 9-3 would initially focus on a turbo-charged petrol variant, but an electric version – initially aimed at the Chinese market – would start production in 2014.

On 8 January 2013, Nevs announced a deal with Qingdao Qingbo Investment Co, Ltd, for a 22% stake in the company. In return, Nevs/Saab would receive SEK 2bn, along with a production facility for models sold in China. Cars sold in North America and most of Europe would continue to be made in Trollhättan, Sweden. The possibility of using Fiat/Chrysler sourced drive train components for non- electric models was also being examined.

On 12 August 2013, the Saab plant at Trollhättan reopened its doors to welcome back employees for preparations and restructuring of the production line. Production of the existing 9-3 would commence shortly with a new electric motor, while Saab finished the preparations for the new 9-3 Phoenix.

On 19 September 2013, the first Saab-branded vehicle produced by Nevs rolled off of the assembly line. The first pre-production model was mostly aesthetically identical to the previous Saab 9-3 and mainly used to test new components and assembly line equipment. Nevs announced a facelift of the exterior to be shown on a finalised production model. On 29 November 2013 Nevs announced that full-scale production would commence on 2 December 2013, having replaced the 20 percent of parts originally sourced from former Saab owner General Motors.

Production of the gasoline version of the Saab 9-3 has resumed as of December 2013. On 10 December 2013, NEVS started selling their Saab 9-3 Aero directly from their homepage to Swedish customers.

On 20 May 2014, NEVS announced that production had been stopped, 100 consultants had to be let go and 53 blue-collar and 19 white-collar workers had been given notice that their contracts would not be prolonged after the summer. According to NEVS, this was due to Qingdao Qingbo Investment Co Ltd not fulfilling their commitment to finance NEVS operations and as a result had forced NEVS main owner Kai Johan Jiang to fund operations for several months through private funds as well as through assets in NEVS parent company National Modern Energy Holdings Ltd.

On 27 May 2014, NEVS communication officer Mikael Östlund confirmed through a video interview that NEVS was in talks with two large automobile companies regarding funding of operations and co-development of the Phoenix platform.

On 9 June 2014, Swedish media reported that a number of companies had filed debts from NEVS at the National Enforcement Agency in Sweden for a total sum of 10.4 million SEK.

On 28 August 2014, NEVS itself filed for bankruptcy protection.

On 29 August 2014, Saab AB announced it was cancelling the licensing agreement that allows NEVS to use the Saab name. NEVS’ financial problems was cited as the reason. A spokesman for NEVS said that the company expects to renegotiate the agreement after a solution to the company’s financial problems is reached.

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A Swedish book, Saabs sista strid, was published on August 28, 2014. The book chronicles Saab Automobile under Spyker and the road to bankruptcy. The author is Swedish financial journalist Jens B Nordström.

As the brand has an unusual image in most markets, Saab owners tend to be correspondingly offbeat: intellectuals and enthusiasts. In his studies of brand communities, Albert Muniz, professor of marketing at DePaul University in Chicago, found significant characteristics of Saab owners which he called Snaabery. These included ownership of an original, pre-GM Saab; camaraderie with other Saab drivers and contempt for other brands such as BMW. Rüdiger Hossiep, a psychologist at Ruhr University Bochum, found that Saab drivers have the highest level of psychological involvement with their cars, being over 10 times more passionate than the average Volkswagendriver. Saab’s main three markets are Sweden, the United Kingdom and the United States.

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