Saab To File For Court Protection From Creditors, Unions: Report

August 26, 2011

Saab's logo may be the mythical griffin, but a nine-lived cat might have been more appropriate.

The struggling Swedish automaker has already twice cheated death at the hands of its parent General Motors, but its ninth life may now be hanging by a thread (to mix a metaphor or two).

According to reports today on public radio, Saab will apply to the courts for protection from its creditors, though no timetable was given. Last week, the Swedish debt-collection agency started proceedings against the company for unpaid bills and wages.

Those creditors include parts suppliers, consultants, and potentially the company's workers, whose paychecks were delayed in both June and July, and may be delayed again at the end of this month as well.

Last month, the company said it would restart car production in August at its plant in Trollhattan, Sweden, after halting assembly this spring in a continuing cash crunch.

Just three weeks ago, Saab formed a pair of alliances with Russian and Chinese partners, announced a plan to sell land, and said it would sell more shares to a new investor.

2011 Saab 9-4X Aero

2011 Saab 9-4X Aero

Despite all that, the production restart never happened. Today, the only Saabs now being built are a handful of 9-4X crossover utility vehicles assembled under contract by General Motors.

Saab is presently owned by Swedish Automobile, the renamed Dutch company that made small numbers of Spyker supercars.

CEO Victor Muller has worked strenuously to raise enough cash to keep Saab afloat, but the carmaker's tiny size, sporadic sales, fleeing customers, and increasingly anxious dealers pose increasingly high hurdles to any kind of long-term success.

The carmaker has already been run by a court-appointed administrator once, early in 2009, when General Motors planned to shut down the company after a deal to sell it to supercar maker Koenigsegg AB fell apart at the last minute. Saab was subsequently bought by Spyker.

According to Reuters, a Saab spokesperson declined to comment on the report.


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