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Swedish press: Saab 'damaged beyond repair'

AFP/The Local · 25 Nov 2009, 11:17

Published: 25 Nov 2009 11:17 GMT+01:00

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"The Death Knell," financial daily Dagens Industri headlined on its front page, while the country's leading newspaper Dagens Nyheter blazed "It's Over Now."

In an analysis piece, conservative daily Svenska Dagbladet said "everything was pointing to the closure of Saab," adding it was "unlikely" a new buyer would turn up.

Saab employs 3,400 people in Sweden and sold just over 93,000 cars worldwide in 2008. Sales have fallen by around 65 percent since the start of the year, while rival automakers have begun to see a recovery.

"Considering the galloping drop in sales this autumn and its rapidly dwindling coffers, the risk of closure is now imminent," Svenska Dagbladet said.

Koenigsegg, which has just 45 employees and produces 18 high-end sports cars a year at more than one million euros ($1.4 million) each, cited costly delays in the takeover process as the reason for its decision.

It had announced in September that it was teaming up with Beijing Automotive Industry Holding Co Ltd (BAIC) to buy Saab from GM.

BAIC said Wednesday it would now "reassess" its options.

GM, which has said it wants to get rid of Saab by the end of 2010, said it would announce its plans for the iconic carmaker next week.

Dagens Nyheter, which called Koenigsegg's bid "a joke from the beginning," said that "unless a miracle happens -- such as a quick and unexpected bid from BAIC or another Chinese manufacturer -- then this is probably the end for Saab."

"The decline in sales has gone too far, the brand has been damaged beyond repair," it said.

While about 3,400 people are employed at Saab's factory in Trollhättan, a town of 55,000 in southwestern Sweden, another 12,000 work for suppliers or subcontractors that directly rely on the automaker for their income.

"This is a tragedy primarily for the employees, who have suffered so much, hoped so much," Dagens Industri wrote.

"It's also a tragedy for the Saab brand, brimming with tradition and a proud history, so many strengths and possibilities -- if only it had had the right owners."

Story continues below…

Saab started life in 1937 as an aircraft manufacturer -- something which became evident in the aerodynamic, sporty shape of its first concept car designs.

The company built its first prototype cars in 1947 with the first production version rolling off the assembly line two years later.

Saab's glory years came in the 1980s when a weak Swedish currency helped boost sales in its export markets, the US and Britain, where it gained a reputation for its turbocharging technology.

AFP/The Local (news@thelocal.se)

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Your comments about this article

12:42 November 25, 2009 by Glempa
I always never convinced about Saab's future with Koenigsegg because car manufacturers need a lot of money and resources that Koenigsegg could never give. The reason why Saab was taken over by GM is becasue Saab couldn't survive on their own. I am also worried about Volvo, although I don't know anything about their chinese bidder.

I remember the same thing happening with Rover cars, when a management buy-out saved the company from closure, but it didn't last long because they were too small to survive on thier own.
12:49 November 25, 2009 by Jan M
It doesn't stop with the Rover comparison. If you look at the political policies (privatisation, reductions in state/social support) and desires of the Swedish electorate (cheap credit, low taxes, something for nothing) then Sweden is on a UK trajectory in general, only about 20+ years behind. If I were a Swede I wouldn't be looking forward to the future.
14:15 November 25, 2009 by spy
What Saab needs right now is a group with the balls to pick this deal up by the scruff of the neck and move forward. Saab financially is in far better shape than it was at the start of the year. It has reorganized, reduced debt, lowered break even point plus I bet it has many of the conditions in place to be an independent company pretty quickly.. But time is Saab's enemy and no doubt they will be feeling beaten-up today and are uncertain of how they will be treated by GM. I am sure these Merbanco guys would be well received by Saab if they were to get involved.
14:15 November 25, 2009 by jack sprat
Its a great shame for a famous marque, but the company must be rapidly bleeding to death with every day that goes by, having so many workers still on its books and so few cars being sold.

A pity so much time was wasted trying to deal with this very suspect consortium.

Maybe China or India could take on what remains, but thats little consolation for Sweden and its workforce.
14:24 November 25, 2009 by V70
Pontiac..Hummer.."Saab-Subaru." Mercury.. Saturn

A.C., Alvis, Austin, Austin-Healey, Bond, Hillman, Humber, Jensen, Lagonda, Lanchester, Marcos, Morris, Panther, Reliant, Riley, Rover, MG, Singer, Talbot, Standard, Triumph, Vauxhall, Wolseley and Vanden Plas ..

SAAB - Sweden RIP
19:29 November 26, 2009 by spy
Swedish media are rubbish they are prone to 180 degree turns on a daily basis.
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