December 18, 2009 by USA Post
Saab News:General Motors Co.’s plans to save Saab by selling it have failed, and the storied Swedish brand will be the latest to hit the scrap pile, the automaker said.
The troubled Detroit automaker said this morning that its last-minute negotiations to sell Saab to a Dutch supercar maker, Spyker Cars, fell through because of due diligence issues that could not be resolved.
Those talks followed the breakup of a deal to sell Saab to another supercar maker, Sweden-based Koenigsegg, late last month.
“We regret that we were not able to complete this transaction,” said Nick Reilly, president of GM Europe. “We will work closely with the Saab organization to wind down the business in an orderly and responsible manner.”
Separate talks with a Chinese automaker have resulted in the sale of some powertrain technology owned by Saab, but will not save the brand, which GM has had a stake in since 1990 and fully owned since 2000.
As a result, the company will initiate activities to shutter Saab completely, a process it has been undergoing with the Pontiac and Saturn brands as well.
GM’s restructuring plans included just four of the eight brands in its portfolio: Chevrolet, GMC, Buick and Cadillac. Before filing for Chapter 11 bankruptcy protection this year, GM said it would kill off Pontiac and attempt to sell Saab, Saturn and Hummer, which it had been attempting to sell since at least late 2008.
A deal to sell Saturn to car distributor Penske Automotive ran aground in late September, leaving only Hummer still in play. That sale, to a Chinese heavy manufacturer, Sichuan Tengzhong, is still being finalized.
The wind-down of Saab will commence immediately, the company said. Drivers of the vehicles will still be able to get warranty service, and parts for the vehicles will continue to be made available.
“We expect Saab to satisfy debts including supplier payments, and to wind down production and the distribution channel in an orderly manner while looking after our customers,” said Reilly.
Last week, Saab said it had sold powertrain technology associated with the 9-3 and new 9-5 models to Beijing Automotive Industry Holdings Co., known as BAIC. GM said today’s news would not affect that sale.
BAIC had been thought to be bidding on the entire Saab brand when it approached GM early this fall, but as negotiations progressed, its interests narrowed.
Although the government of Sweden has offered to make loan guarantees to a potential Saab buyer, it has refused to bail out the brand itself. Saab has 3,400 employees worldwide and 1,100 dealers.
Saab was founded in 1937 to make airplanes. It made its first car in 1946. Through the first 11 months of this year, GM sold 7,812 Saab cars and SUVs in the U.S., a 61% decline compared with a year earlier, and the brand’s worldwide sales are expected to come in under 50,000 units this year. .
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