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GM: Saab Will Be Shut Down

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GM has announced that it could not close a sale of its Saab division--and that the division will be shuttered.

General Motors had been negotiating for most of this year with other car companies interested in acquiring the Swedish automaker. Just last week, GM reached an agreement to sell the tooling for the previous-generation Saab 9-3 and the Saab 9-5 to China's BAIC. GM had negotiated with Swedish supercar maker Koenigsegg to take over the brand, with a $500 million loan guarantee to be arranged with Chinese investors and the Swedish government. Koenigsegg was unable to complete the deal, and GM had until today been in talks with Dutch supercar company Spyker on taking over the Saab name.

"There's been no shortage of effort in the past 20 years to put Saab on some long-term footing," a GM executive said, when asked if General Motors had successfully steered the brand in its two decades of ownership. "For no lack of effort, we've not been successful."

Those talks have ended, and General Motors now says it will close the Saab brand in an "orderly" fashion--leaving an entirely new 2010 Saab 9-5 on the table without ever putting it in showrooms, and a stillborn 9-4X crossover based on the 2010 Cadillac SRX also falling to the cutting-room floor.

As for the vehicles that had been in the Saab portfolio and product plan, GM executives told High Gear Media this morning there's no current plan to sell the tooling and intellectual property for the fully developed 2010 Saab 9-5 to another car company, though the situation is still under study. The vehicles in development and the company itself could still find a savior, GM executives suggest, but the wind-down process will go ahead in January.

GM says it will continue to honor all Saab warranties.

General Motors took a 50-percent stake in Saab in December 1989--twenty years ago this month--and acquired the remaining 50 percent in 2000.

GM estimates some 3,400 employees worldwide will be affected by the Saab closure, with the majority in the Swedish headquarters in Trollhattan.

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The full press release from GM follows:

General Motors announced today that the intended sale of Saab Automobile AB would not be concluded. After the withdrawal of Koenigsegg Group AB last month, GM had been in discussions with Spyker Cars about its interest in acquiring Saab. During the due diligence, certain issues arose that both parties believe could not be resolved.  As a result, GM will start an orderly wind-down of Saab operations.

“Despite the best efforts of all involved, it has become very clear that the due diligence required to complete this complex transaction could not be executed in a reasonable time. In order to maintain operations, Saab needed a quick resolution,” said GM Europe President Nick Reilly.  “We regret that we were not able to complete this transaction with Spyker Cars. We will work closely with the Saab organization to wind down the business in an orderly and responsible manner. This is not a bankruptcy or forced liquidation process. Consequently, we expect Saab to satisfy debts including supplier payments, and to wind down production and the distribution channel in an orderly manner while looking after our customers.”

Saab will continue to honor warranties, while providing service and spare parts to current Saab owners around the world.

As part of its efforts to become a leaner organization, GM began seeking a buyer for Saab’s operations in January.  Last week, Saab Automobile AB announced that it had closed on the sale of certain Saab 9-3, current 9-5 and powertrain technology and tooling to Beijing Automotive Industry Holdings Co. Ltd. (BAIC).  GM expects today’s announcement to have no impact on the earlier sale.

As the company continues to reinvent itself, GM has been faced with some very difficult but necessary business decisions. The focus will remain on the four core brands – Buick, Cadillac, Chevrolet and GMC – and several regional brands, including Opel / Vauxhall in Europe.  This will enable the company to devote more engineering and marketing resources to each brand and model.

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Comments (17)
  1. I will never purchase another GM product, nor should any other SAAB owner.
     
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  2. The 9-4X may have been based on the SRX; but the upgraded SRX engine is the turbo 6 from the 2008 Saab Turbo X. So many manufacturers (GM, Ford, BMW, etc) are making a big deal about introducing turbos, while Saab has been making them forever. Saab balanced performance and efficiency long before any else cared about it, and GM managed to find a way to kill it off through uninspired marketing and a gradual loss of its unique identity. Now BMW has the 5 Series GT, sort of reminds me of the 9000 that Saab had in 1985.
     
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  3. "Saab balanced performance and efficiency"
    Really? Any hard numbers to back that claim?
    As far as I remember Saab was around mid-pack and below (including that 08 Turbo X). That's why there was no reason to buy one in recent years.
     
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  4. GM has become an equity-killing machine over the past 10 years. It's amazing how efficiently they've squandered market share, brand value and consumer good will.
     
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  5. Maybe the Swedes should buy it back, its their economy that will take the biggest hit.
     
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  6. Sad story... I liked their cars and I guess GM did all the mistake they could on this great brand.
     
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  7. @Sed: Alas, the Swedes already said "Nej" to Saab: http://www.nytimes.com/2009/03/23/world/europe/23saab.html
    _
    Amid all the eulogizing that's going on today, no one wants to bring up the fact that Saab hasn't turned a profit in (at least) 20 years.
     
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  8. Always sad to see layoffs and the failure notwithstanding terrific efforts. If ever it was time to call it quits, feels like this is one of those moments. Brand was simply not "premium" enough to extract high prices and certainly there as no "volume" play here either.
     
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  9. The latest 9-5 looks good, but it doesn't look like a Saab anyway. Why doesn't GM take it at this point and sell it as a Buick? Or at the very least as an Opel?
     
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  10. The SAAB was a quirky small brand and it always remained somewhat distinctive looking. SAD about SAAB but I guess something had to go.
     
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  11. Not a Buick - it's a LaCrosse, for Freya's sake. How about a mid-size Cadillac? Much closer to the target, Caddy needs volume--and needs a front-drive lineup like Lexus has for the fuddys.
     
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  12. Saab's been a dead brand for years. This is just recognizing reality. Its niche--good performance in snowy areas, odd but clever engineering, spartan but durable cars--was taken over in the mid-1990s by Subaru, who have done well by it and sold 6x the number of cars.
     
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  13. A GM Executive said "...no shortage of effort in the past 20 years to put SAAB on solid footing". More like no shortage of effort to remove all brand identity and desirability (albeit niche), and blend it into oblivion. What was the reason behind the purchase of SAAB in the first place? Oh yeah, that was because Ford was buying up everything in sight and GM was feeling intimidated. I'm all for free market, but clearly capitalism does not discriminate against idiots; everyone involved in GM's acquisition and branding decisions has been excused from their position with a payout bigger than most of us will earn in a lifetime.
     
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  14. http://tictacdo.com/ttd/Comfort-Someone-Who-Is-Sad - This is for all the shareholders that have lost money due to GM's destruction of Saab. This has mismanagement written all over it as in 2006 Saab was enjoying record sales. GM threw out the innovative and truly energy-saving Saab guts and replaced them with cheaper Opals (also going under, as I understand). Anyone know what actually happened over there? Smells like politics to me. Was the Swedish gov stepping on GM's toes? What a waste – what a shame.
     
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  15. I recently learned that Saab engineers jets for the Swedish Air Force- are they still doing that? Does anyone know?
     
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  16. Saab was the best car that I have ever had. Now you are telling me that I will now have problems getting parts and repair work done on my car not to mention no trade in value. I am very disappointed and will never buy a GM product again.
     
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  17. Hi,
    Why have no one started a campaign and debate, via internet preferably, to boycott all GM.s cars, this as a result of GM.s unacceptable handling of the SAAB.
    We have to show that there can also be negative consequences if companies like SAAB are treated the way GM is treating SAAB.
    Don’t forget that there are many SAAB owners and supporters all around the world, not only in Sweden. Furthermore SAAB has the support of all the people that are against the consequences of the globalization.
    Personally I will never by a GM car or product in the future.
    Cato
     
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