GM - which still produces the 9-4X crossover - says it has "many unanswered questions" about the planned sale of Saab to the Chinese.
The Saab soap opera could take yet another turn, General Motors warning that it could move to block the sale of the cash-starved Swedish automaker to a Chinese consortium.
That $142 million deal, announced on October 28, appeared to be the only way out for Swedish Automobile after failing to raise the cash it needed to save Saab. But the carmaker’s former parent, General Motors, indicates it could use its remaining veto power to prevent the Chinese from creating a new global competitor.
GM sold Saab in early 2010 after agreeing to sell or close four of its eight North American brands as part of its government bankruptcy bailout. The new owners proved to be seriously underfunded, a situation which became clearly apparent this past March, when key suppliers began boycotting Saab’s headquarters assembly plant over unpaid bills.
Swedish Automobile raced to negotiate a series of possible deals to raise some much-needed cash. In June, it inked a preliminary agreement with China’s largest auto dealer network, Pang Da, along with emerging automaker Zhejiang Youngman Lotus. But their goal of acquiring a 53% stake in Saab was set back by reluctant bureaucrats who refused to give their authorization.
That forced Saab to file for protection under Swedish law as it reorganized its finances. By late last month, however, the company’s court-appointed administrator appeared ready to push Saab into liquidation.
The carmaker pulled out an 11th hour deal with Pang Da and Youngman to sell them the entire company – but at less than half what they originally offered for the smaller stake. The two Chinese firms subsequently announced plans to together invest more than $2.8 billion in Saab to turn it into a truly global force.
That money would be used to set up a production plant in China and to add new models to the Saab line-up. Earlier this year the Swedes announced plans to introduce a new small car, dubbed the 9-1, as well as several other models.
That appears to worry GM, especially when it comes to China, where a more powerful Saab could pose a serious challenge. General Motors is currently the largest automaker in China, where it expects to sell more than 2.5 million vehicles this year – but the market has been slowing, in recent months, raising questions about GM’s goal of doubling sales by mid-decade.
“We have many unanswered questions about the transaction,” GM spokesman Jim Cain told Agence France Presse, adding that it would not approve the sale if the new ownership “could negatively impact GM’s existing relationships in China or otherwise adversely affect GM’s interests worldwide.”
On the other hand, the spokesman noted, if the new buyers were to provide the right answers GM would consider continuing as a supplier to Saab. It currently builds the Swedish company’s new 9-4X crossover vehicle at a GM plant in Mexico.