No Saab story, as incentives keep the maker's headquarters from fleeing Michigan.
Swedish automaker Saab is expected to abandon its current headquarters at General Motors’ Renaissance Center, in downtown Detroit. But barring a last-minute hitch, the company, now owned by the Dutch based supercar maker Spyker, will only head about 10 miles north, to the Detroit suburb of Royal Oak.
Michigan has struggled to maintain its position as the heart of the American auto industry, and after losing Volkswagen of America and its subsidiaries, several years ago, the state government reportedly kicked in with significant incentives to keep Saab from fleeing, as well. Prior to being purchased by General Motors, the company had been operating out of suburban Atlanta.
Michigan Governor Jennifer Granholm is expected to announce a five-year package of tax incentives, today, that will be matched by Saab’s commitment to remain in the Detroit region. The automaker, post-GM, is actually expected to expand its Detroit operations, reportedly promising to invest $2.4 million and create as many as 60 jobs over the next five years – bringing the headquarters total to around 160. According to data presented to the state’s development agency, Saab expected those jobs to pay nearly $85,000 a year, on average.
While the move would be a plus for Michigan and the Motor City suburbs, it would be yet another setback for Detroit itself. The city has been steadily losing both employers and employees. A recent package of incentives forestalled a proposed move by General Motors itself to start emptying out the Renaissance Center towers and relocate thousands of employees to the company’s technical center, also in the suburbs.
While Michigan may be celebrating its apparently successful effort to hang onto Saab, industry analysts remain unconvinced when it comes to the maker’s long-term viability. Saab has seen sharp declines in its sales for the last several years, even when factoring in the automotive slump. On the plus side, several new products are winning solid reviews, including a total remake of the flagship 9-5 sedan and an all-new crossover, the 9-4X.
New owner Spyker has suggested it plans to add to the line-up, most likely with a new compact to be called the 9-2. But owner Victor Muller, founder of the Dutch Spyker, acknowledged, in a conversation with TheDetroitBureau.com, last month, that his company currently does not have the financial resources to give the project a go yet.