• Sweden's news in English

Saab lacks funds to pay staff wages

TT/The Local/rm · 23 Jun 2011, 08:36

Published: 23 Jun 2011 08:36 GMT+02:00

Facebook Twitter Google+ reddit

"It is dreadful. Completely unbelievable. I get chest pains. How on earth are we supposed to pay our bills?," said Fredrik Almqvist, employee of Saab since 16 years to news agency TT.

When Almqvist woke up on Thursday morning, a text message from a colleague alerted him to the fact he would not receive any wages.

He ran downstairs, turned on the TV and read on tele-text that Saab won't be able to pay their employees.

“It is regrettable to have to notify staff of this the day before midsummer,” said Gunilla Gustavs of the information department at Saab Automobiles to news agency TT.

According to Gustavs it is impossible to say when wages could be paid out to Saab personnel.

“It is impossible to make any sort of forecast, except to repeat that the company is trying to solve this as quickly as possible,” aud Gustavs to TT.

The information reached Saab employees via email on Thursday morning.

"It has been sent to all employees notifying them that the company is late with payments," confirmed Sten M Larsson, deputy head of trade union Unionen to TT.

And the worker's trade union IF Metall are worried. The late payment will affect between 1,400 and 1,500 of the union's members at Saab.

"Of course it is in no way positive that the company has got in such a pickle that they can't pay wages to their employees," said Häkan Skött, of the Metall union to TT.

Svenåke Berglie, chairman of FKG, the trade association representing Scandinavian suppliers to the automotive industry, told TT that this shows just how desperate Saab's situation is.

"It is very worrying that they can't even give a prognosis. they should be able to say when it will be dealt with, if it is this afternoon or tomorrow," Berglie told TT.

Recently Saab's Dutch owner Spyker announced it planned to hand over majority control of Saab to two Chinese companies, distributor Pang Da Automobile and car manufacturer Zhejiang Youngman Lotus Automobile, in a bid to secure last-ditch rescue funding.

While observers hailed the deal, which also boosted Spyker's share price, they cautioned it might not go through quickly enough to secure the desperately-needed short-term cash Saab needs to stay afloat.

Saab, which employs 3,800 people, was rescued at the last minute in early 2010 when tiny Dutch company Spyker bought it for 400 million dollars from US auto giant General Motors.

After initial optimistic statements and production forecasts, Spyker and Saab have recently been scrambling to pull together enough cash to keep production going and suppliers happy.

Saab's main factory stood still for over seven weeks during April and May as suppliers halted their deliveries to Saab over unpaid bills.

Story continues below…

Production started up again on May 27 but stopped again on June 8 when the company complained it was missing components for the assembly line.

Assembly line workers were informed in a meeting on Monday that they would not be needed back at work until Monday, July 4.

According to the latest Saab statement, the company is in talks with several different parties in order to raise the cash both in the short run and through property sales and leasing.

According to the Saab statement there are no guarantees as of yet that these discussions will prove successful enough to result in more money.

TT/The Local/rm (news@thelocal.se)

Facebook Twitter Google+ reddit

Your comments about this article

09:14 June 23, 2011 by Dazzler
This saga is becoming laughable.
09:38 June 23, 2011 by sushi_and_sweden
it sounds like a story of a small business. but they have more than 10,000 employees? poor and funny story.
10:11 June 23, 2011 by Gletta
A complete lack of credible management ruining peoples hopes and lives continues.
11:32 June 23, 2011 by johnny1939
No surprise here. As long as I can recall the Saab car division has had problems. Nice car . Must be bad management. Employees(present) must have seen the handwriting on the wall a long time ago but in this case somebody must arrange to pay these poor people. I understand that not all employees are union members and they have to be taken care of some how
11:42 June 23, 2011 by Twiceshy
Saab should have gone bankrupt a while ago, and not get its debts guaranteed by the Swedish government.

I wonder if taxpayers will end up footing the bill in the end... As for Saab employees, they'll end up having to train for another job, which they could have done earlier in their lives if Saab had not been "saved" (improving their job prospects).
12:14 June 23, 2011 by miss79
more jobless people to come
00:45 June 24, 2011 by wakak
Look at what is becoming of Swedish flaggship (oops, i forgot Volvo in Chinese hands... at least, they pay their employees).

But nobody seems to blame Swedish worklife balance: in today's world, a company cannot succeed having 30mn fika everyday, and getting the kids at day care at 3 pm, whatever the work you have to achieve. Does anyone think that Audi or even Fiat workforce behave like that?

Saab might be a victim of that. More to come, undoubtedly...
09:17 June 24, 2011 by Arcticeric
hopefully the union will have the where-with-all to place Saab in bankruptcy and thereby get its members on the long road to recovery...
15:32 June 24, 2011 by Luke35711
Sweden is out of control! This country is truly out of control! The traditional under-handed way of governing Sweden does not work anymore! It is embarrassing internationally, it is embarrassing domestically, and it will lead to a terrible political and economic crisis.

Lets not forget this used to be a very poor and backwards country. During the Swedish emigration to the United States in the 19th and early 20th centuries, about 1.3 million Swedes left Sweden for the United States. But this time, there will be nowhere to emigrate to. Very sad.
03:21 June 25, 2011 by repat_xpat
Wakak, You are too right. In the mid 2000's, a GM ISP wrote a list of work ethic milestones for SAAB to meet to enable it to become profitable. This exec was sent home "in shame." SAAB laughed at him and refused to change to become productive. I don't know this first hand, I learned of it second hand, when a high level SAAB CEO share this with me as I started my ISP. He was warning me not to try to change the way that SAAB does business. He was right, I would fail to be able to change the work practices at SAAB.
15:16 June 25, 2011 by Luke35711

So do you think this is about lack of effort (too much time off for everybody), or low ethical standards? I suspect this might be just as much about low ethical standards, low internal trust, inter-departmental conflicts, tribalism (workers against management, management against engineers, engineers against everybody else), etc. Swedes in general have low communication skills, and I have seen petty human conflicts literary jamming large organizations for months.
20:37 June 27, 2011 by repat_xpat
> Luke

Yes. The factory in Trollhattan was the least efficient GM plant in the world and GM was unable to change the culture to make it efficient. It might be a stretch to say it is Swedish culture, but Swedish culture does impact SAAB's work practices.

A company is simply a group of people working together to bring the right products to market at the right price. A successful company is able to define the right products and align its people to create them efficiently. SAAB has been unable to do both of these.

The bottom line is that the new 9-5 is 10K more expensive than its Opel and Buick sisters (same car, different skin). There are not enough people who love SAAB that much.
Today's headlines
Malmö's 19th Swedish title sets Champions hopes alight
Malmö fans celebrating after the match. Photo: Björn Lindgren/TT

Malmö FF have their eyes set on the Champions League after winning the Swedish league for the 19th year.

What's on in Sweden
Five great autumn events in Sweden this week
Jazz in northern Sweden. Photo: Umeå Jazz Festival

Food, music, movies and more food. What better way of helping yourself forget that the days are getting shorter and colder?

Here's how slow Sweden's high-speed trains are getting
A Swedish SJX2000 high speed train. Photo: Tomas Oneborg/SvD/TT

The high-speed rail journey between the three biggest Swedish cities is about to get longer.

The Local List
12 Swedish words with just awesome literal translations
A filthy-minded lobster, i.e. a snuskhummer. Photo: Gorm Kallestad/NTB scanpix/TT

One of our favourite things about the Swedish language is its wonderful compound words, which range from being utterly bizarre to making perfect sense.

US election
Donald Trump won't get new Ericsson head's vote
Trump pictured at a campaign rally in Florida. Photo: Evan Vucci/AP

The new Swedish-American boss of telecoms giant Ericsson has revealed he will not vote for the Republican nominee in the forthcoming US presidential election.

Swedes named fourth most gender equal in the world
A file photo of men and women pushing prams in Stockholm. Photo: Claudio Bresciani/TT

Sweden has closed 81 percent of its overall gender gap according to the World Economic Forum.

Sweden: Russian warships in the Baltic 'worrying'
Swedish Defence Minister Peter Hultqvist. Photo: Vilhelm Stokstad/TT

Two Russian warships equipped with long-range missiles have entered the Baltic Sea after passing Denmark.

Why businesses are worried about Sweden's drone ban
A drone filming in Stockholm. Photo: Pontus Lundahl/TT

The Local investigates what Sweden's new drone ban could mean for businesses in the country.

This is the new top boss of Swedish Ericsson
Börje Ekholm. Photo: Magnus Hjalmarson Neideman/SvD/TT

Telecoms giant Ericsson has appointed a new CEO after a turbulent year for the company.

These are Sweden's best universities: ranking
A new university ranking has been released. Photo: Cecilia Larsson Lantz/Imagebank.sweden.se

At least according to this global ranking, which picks 12 Swedish universities among the top-1000.

Sponsored Article
Stockholm: creating solutions to global challenges
Sweden cuts 2016 refugee forecast
Sponsored Article
Last chance to vote absentee in the US elections
Is Game of Thrones coming to Sweden?
Property of the week: Kungsholmen, Stockholm
Blog updates

6 October

10 useful hjälpverb (The Swedish Teacher) »

"Hej! I think the so-called “hjalpverb” (auxiliary verbs in English) are a good way to get…" READ »


8 July

Editor’s blog, July 8th (The Local Sweden) »

"Hej readers, It has, as always, been a bizarre, serious and hilarious week in Sweden. You…" READ »

Sponsored Article
This is Malmö: Football capital of Sweden
Will Swedes soon be looking for fairtrade porn?
Sponsored Article
Where is the Swedish music industry heading?
The Local Voices
'I simply don’t believe in nationality'
Why we're convinced Game of Thrones is based on Sweden
People-watching: October 21st-23rd
Sponsored Article
Why you should 'grab a chair' on Stockholm's tech scene
Fury at plans that 'threaten the IB's survival' in Sweden
Sponsored Article
Swedish for programmers: 'It changed my life'
Analysis & Opinion
Are we just going to let half the country die?
Angry elk chases Swede up a lamp post
Sponsored Article
Top 7 tips to help you learn Swedish
The Local Voices
'Alienation in Sweden feels better: I find myself a stranger among scores of aliens'
Sponsored Article
‘Extremism can't be defeated on the battlefield alone’
People-watching: October 20th
The Local Voices
A layover at Qatar airport brought this Swedish-Kenyan couple together - now they're heading for marriage
Sponsored Article
Stockholm: creating solutions to global challenges
Swede punches clown that scared his grandmother
Sponsored Article
Why you should 'grab a chair' on Stockholm's tech scene
Fans throw flares and enter pitch in Swedish football riot
Sponsored Article
Where is the Swedish music industry heading?
Could Swedish blood test solve 'Making a Murderer'?
Sponsored Article
One expat's strategy for making friends in Stockholm
Swedish school to build gender neutral changing room
Sponsored Article
Nordic fashion in focus at Stockholm University
People-watching: October 14th-16th
Man in Sweden assaulted by clowns with broken bottle
Nobel Prize 2016: Literature
Watch the man who discovered Bob Dylan react to his Nobel Prize win
Record numbers emigrating from Sweden
People-watching: October 12th
The Local Voices
'Swedish startups should embrace newcomers' talents - there's nothing to fear'
How far right are the Sweden Democrats?
Property of the week: Triangeln, Malmö
The Local Voices
Syria's White Helmets: The Nobel Peace Prize would have meant a lot, but pulling a child from rubble is the greatest reward
jobs available