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GM Would Rather Kill Saab Than Sell Brand to Buyer That Might Fail


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GM Would Rather Kill Saab Than Sell Brand to Buyer That Might Fail

By William Diem

WardsAuto.com, Jan 13, 2010 9:35 AM

DETROIT – Although it is still talking with Spyker Cars. N.V. and other investors interested in buying the Saab brand, General Motors Co. plans to wind down production of the Swedish cars by the end of January.

“We’ve been trying for years to sell it,” and no viable offers have arrived, GM Europe CEO Nick Reilly says in a roundtable discussion with journalists at the North American International Auto Show here.

“We’re not asking a lot of money for the company,” he adds, but a buyer would need on the order of €450 million ($655 million) to run the company. “We’re not going to hand it over to someone with little likelihood of success.”

The Swedish supercar maker Koenigsegg Group AB had arranged such a figure with the European Investment Bank but later decided to pull out of negotiations.

Reilly says GM would prefer to close Saab rather than sell it to someone it believes would fail. GM is obliged to support its customers for another 10 years, and if a new buyer went out of business, the obligation would come back to the U.S. parent.

Reilly says a sale still would be possible in the next two to four weeks, but the possibility becomes more and more remote as the wind-down continues.

He also notes the Spyker negotiations started earlier and were in more depth than the group in which the Grand Prix’s Bernie Ecclestone is involved.

It will take six months to completely wind down Saab, Reilly says. The only portion that GM might keep is a small engineering facility in Sweden for powertrains. Saab has been a pioneer for turbocharging small-displacement engines.



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