Saab fights to stay on the road
The troubled Swedish automaker Saab has been in the news a lot lately as they try to get the money they need to stay on the road. But with so many parties involved, striking a deal is complicated and all the back-and-forth can be hard to keep track of. What's really going on, and will it help?
For the last three weeks, Saab's production lines in the southwestern Swedish city of Trollhättan have stood still, as the company does not have enough money to pay for the parts it needs to make cars. One of their subcontractors in Sweden has also threatened to lay off 200 workers.
"For Saab, the problem has been that it's never grown up," says the editor for the motors section of the newspaper Dagens Nyheter, Jacques Wallner, to Radio Sweden.
"It's stayed small, it's stayed vulnerable. It has a reputation and it has a lot of love from the customers, but it's never made the growth," Wallner continues.
"It's always had problem with not enough production, not enough sales, not enough cash flow, not enough money, no profit," says Wallner.
Saab has been looking for a lifeline. They have been talking with Chinese investors, but the focus lately has been on the Russian investor Vladimir Antonov. Antonov wants to do a couple things: first, he wants to buy Saab's property and then lease it back to them. This would give Saab a fast cash injection. He also wants to buy about a third of the company to become a part owner.
But there are a bunch of green lights that Saab needs before this all goes through: the Swedish government, the National Debt Office, the European Investment Bank, and its former owner, General Motors. They acquired Saab back in the 90s and then sold it to the Dutch luxury auto maker Spyker last year.
While there have been a lot of developments this week, there still hasn't been any official handshake.
On Thursday, the Swedish National Debt Office gave the go-ahead for Antonov to get a major stake in the company. GM also gave their blessing, but only with provisos. Details of those are not clear.
Meanwhile, media reports early in the week indicated that the European Investment Bank, which has backed some of the company's loans, seemed willing to let the property sale go through but only on certain conditions, which Antonov's spokesperson said were "unreasonable." The Swedish government also said it would let Saab raise cash by selling real estate to Antonov, but haven't yet given word that Antonov can be a part-owner in the company.
But even if the deal goes through, Antonov can only be part of a "quick fix," Wallner believes.
In the long run, Wallner says that Saab needs a "strategic partner -- someone that they could develop new products together with and maybe produce together with" to survive in the long run.
Wallner also believes that even if Saab does go under, it won't have a big impact on the Swedish economy. He says the company is not what it used to be in terms of sales and production, even if it is an iconic Swedish brand.