Analysts say that Youngman China may not be able to save Saab

Article by Christian Andrei, on June 15, 2011

Analysts are saying that Spyker Cars NV's agreement to sell its 29.9 percent share of Saab to Zhejiang Youngman Lotus Automobile Co. may not be able to help the automaker recover.

The analysts, which are from Synovate Motoresearch, Autoforesight Shanghai Co. and IHS Automotive, stated that Youngman may be too small for an automaker in China to obtain approvals from government regarding the production of vehicles in the largest car market in the world.

They added that there is a high probability that China's focus on the consolidation of the automotive industry may scrap the deal. Spyker is working on securing long-term financing for Saab after the automaker halted production for several weeks in April and May due to disputes on payment with parts suppliers. Spyker stated on Tuesday that it will sell its stock in Saab to Jinhua-based Youngman for 136 million euros ($197 million).

In addition, Pangda Automobile Trade Co. will pay 109 million euros for a 24 percent stake based on a deal last May to invest in Saab. Lin Huai Bin, an analyst at IHS Automotive, stated that he has the impression that Saab is scurrying to find any Chinese partner now.

He added that Saab needs to find a sizable company with good profit as well as government connections if ever it wants to succeed in China.

According to Lin, Youngman may find it hard to persuade the Chinese government to approve a manufacturing venture, considering the company's size as well as the country's cautiousness to have further capacity expansion in the vehicle industry.

Topics: saab, china

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

More positive news has been pouring in before the year ends. For those who have been waiting to hear the latest word on Toyota 86, we have some great news....
by - December 10, 2016
Hyundai is making the green vehicle race more competitive by offering three powertrain types -- pure electric (EV), hybrid (EV plus combustion engine) and plug-in hybrid (PHEV) – in one...
by - December 9, 2016
Although specs for the new Renault Megane had already surfaced several weeks ago, we didn’t know that the company has cooked up something new. Aside from the 200hp gasoline, Renault‘s...
by - December 9, 2016
For the first time in fifty-eight years, Infiniti registers its first US-Spec Q60 Coupe in Cuba. American products have not been allowed entry into Cuba for six decades. But it...
by - December 9, 2016
Chevrolet has already given out the pricing for some of its 2018 Equinox models. Not only will the new Equinox be available in both the US and Canada, it is...
by - December 9, 2016
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries