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Saab pins hopes on new 9-5 after Spyker rescue

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Saab pins hopes on new 9-5 after Spyker rescue

June 2, 2010 06:01 CET

TROLLHATTAN, Sweden (Reuters) -- Saab is launching its first new car, the flagship 9-5, as it hopes to restore buzz and sales to the iconic Swedish brand after its rescue earlier this year by Dutch niche car maker Spyker Cars NV.

Amid anaemic demand -- global auto sales sank 13 percent in 2009 to a seven-year low -- Saab is aiming to more than double yearly sales to 85,000 by 2012 to avoid losses. Last year, it sold nearly 40,000 cars.

At Saab's headquarters in Trollhattan, where thousands of employees gathered in January to cheer Spyker CEO Victor Muller's gutsy $400 million deal to buy Saab from General Motors, Saab's CEO promised to restore the brand and the company at a launch event on Tuesday.

"The biggest challenge we have right now is to rebuild confidence and trust," Saab CEO Jan Ake Jonsson said.

"We have a work force that has an extremely high motivation level," said Jonsson, who took the helm in 2005 while Saab was still owned by General Motors Co.

The 9-5, which replaces a 13-year-old line, is mainly aimed at buyers of Audi's A6. Saab also wants to make sure the 9-5, which shares its platform with the Opel/Vauxhall Insignia, is distinct from the smaller 9-3. One criticism leveled at Saab was that its older 9-5 and 9-3 models were far too similar in size.

With a base price of about 35,000 euros ($42,520), the 9-5 finally brings Saab's flagship model up to par with rivals, with lower emissions, features such as keyless entry and active four-wheel drive, and luxury comforts.

"For Saab, this is the most important product," said Muller, speaking at the launch event. "It means we are alive."

Jonsson said newer Saab models will reflect more of Saab's heritage, particularly its distinctive styling and turbocharged engines, that has attracted affluent and design-conscious customers.

Despite its hopes, the company is keeping expectations in check, saying that it plans to sell 50,000 cars this year, compared with yearly sales of more than 130,000 just five years ago.

Saab hired Adrian Hallmark, formerly of Volkswagen, this year to be its head of sales with instructions to rebuild the company's global distribution.

Saab is nearly done with replacing GM's distribution network in 23 countries, either by buying existing intermediaries or building out its own, positioning it to sell cars directly to dealerships instead of through an intermediary which should help improve the profit margin on each car, said Hallmark.

Saab's sales organisation will be completely separated from GM by September, and by the end of the year Saab is also planning to launch or re-launch in China, Russia, Japan, Australia, Canada, Brazil and Mexico.

Read more: http://www.autonews.com/article/20100602/ANE/306019953/1198#ixzz0phuhrb00

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