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Saab's U.S. Dealers Pray For Miracle, Ask For Chapter 11 Protection

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2011 Saab 9-4X

2011 Saab 9-4X

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Saab is dead, but the dream of Saab lives on -- at least in the U.S. According to a report in AutoNews, a group of Saab dealers in the States have banded together to petition a U.S. Bankruptcy Court for Chapter 11 status.

Why Chapter 11? Because it allows the possibility -- no matter how slim -- that Saab might still get its act together. According to Leonard Bellavia, a lawyer representing the dealers in court, Saab's Dealer Council wants to keep the door open to a "white knight" who might ride in at the last minute and save the struggling company. The alternative would be a Chapter 7 bankruptcy, which is fairly irreversible and would put Saab's assets in control of a third-party overseer, giving the company and its dealers less say in their demise.

Apart from the glimmer of hope that Saab dealers seem to hold, the other interesting part of this story is that the Dealer Council filed for Chapter 11 in Delaware, and it did so before Saab Cars North America had the chance to submit its own bankruptcy paperwork. If Saab Cars North America had filed first -- probably in Detroit -- the situation could've been very different. As Bellavia explained in an interview, a Michigan court might've given preferential treatment to an automaker over dealers. Down the line, when the talk turns to asset sales and repayment of debt, dealers could've wound up with an even shorter end of the stick.

Bottom line: Saab is going away, and even the most optimistic fans realize that's the case. But a bankruptcy run through Delaware courts should allow dealers greater control over the pace of their own death-spiral. That, in turn, could make a big difference in how badly they get bruised in the process.

And hey, if that white knight does show up, Chapter 11 will let him get a hoof in the door before it closes for good.

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Comments (4)
  1. $aab.........just get it over with.......'B' Gone!
     
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  2. "Saab is going away, and even the most optimistic fans realize that's the case." Say what? Have you guys even bothered to do the research? There are three delegations (China, Turkey, and India) in Sweden right now discussing a purchase. Loyal customers are waiting and hoping. SAAB is a great brand with a very loyal following. Its true fans have not given up hope. Until the factory in Trollhattan is flattened to the ground, we will not lose hope. Go off and drive your boring BMW and Audi crap. :-)
     
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  3. I hope you are right, but as long as OBAMA/GM has veto power over any deal the chances seem very slim indeed.
    It is unfortunate SAAB was allowed to drift for years under GM with virtually no new product and no focus.
     
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  4. Without GM, SAAB would've been going through this years ago. Why? Their cars were niche offerings that attracted dorks.

    Unfortunately, there weren't enough of them around to keep it afloat.

    As for a potential purchase, GM will not let anybody from China buy its assets, good luck with a group from Turkey trying to fund ongoing losses and Mahindra's been kicking tires for years and never done anything.

    Good luck.
     
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