GM gives Saab a lease on life just 18 months after abandoning it

Article by Christian Andrei, on June 5, 2011

It’s ironic that General Motors had intended to terminate the Saab brand before deciding to sell it to Spyker Cars NV in February 2010 but now, GM is back to producing Saab's new 9-4X crossover.

For 10 days last May, GM (the former parent of Saab Automobile) was the sole producer of Saab vehicles after Saab’s plant in Trollhaettan, Sweden, had to shut down due to inability to pay suppliers.

Garel Rhys, president of University of Cardiff's automotive industry research center, said that GM is giving Saab “a lifeline” to eventually find a source of funds. He added that what GM is doing now is an indication of what it could still have done for the brand when it was still the owner.

During that period from 2003 to 2008 when Saab was owned by GM, it incurred operating losses of 16.5 billion kronor ($2.65 billion). Since Spyker bought Saab, it had posted losses of about 25 million euros a month before production was closed on March 29.

It’s expected that the 9-4X, the first Saab model to feature sport-utility vehicle proportions with car handling, will significant boost revenue. Saab was able to restart production recently after receiving a short-term loan from shareholder Gemini Investment Fund Ltd. and entering a deal with Chinese car dealer Pangda Automobile Trade Co.

Topics: saab, gm

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