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By Mark Kleis

Saab Automobiles, the unique Swedish automaker long known for its easily recognizable style of its own, is on a mission to return to profitability after recently being acquired by Spyker Cars from General Motors.

Although the accounting by GM made it hard to truly determine the profitability of Saab while it relied heavily on parts sharing with fellow GM vehicles, it is believed Saab has not been a profitable brand in years. In 2012, Saab aims to return to profitability, but before 2012 the automaker has big plans to expand the markets in which it sells its cars in 2011.

The executive director of sales for Saab, Adrian Hallmark, told Bloomberg via telephone interview that the automaker is currently in the midst of acquiring key distribution partners in four major countries with the intention of forming agreements in 2010. “In the next two years the new markets will not materially change our performance volume-wise, but in the next five years I believe they will fundamentally change our performance,” said Hallmark.

Although Saab is no stranger to world markets, when the brand was struggling and its then-parent company, General Motors, was facing bankruptcy, Saab was pulled from key global markets such as Russia and China. Now, as Spyker looks to put Saab back on the global map, the automaker is working to find key partners in order to make distribution, and possibly even manufacturing in various markets a viable and profitable option.

Import or sell?

One thing Saab must consider is whether it wants to simply import vehicles into certain markets, or form local partnerships to start localized production. In China, for example, Hallmark suggested that they would likely only sell two to 5,000 vehicles if they import cars into China, where as forming a local partnership would likely result in annualized sales of some 50,000 vehicles.

Other key markets for the Saab brand include Mexico, Brazil, India and Russia. Hallmark said Saab is in talks with four possible partners in Russia, and 15 possible partners between Mexico and Brazil. Hallmark also told Bloomberg that the Swedish automaker has its eyes on the Indian market in the second half of 2011, for which the brand plans to sell its new 9-3 sedan.



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Saab targets return to Mexico, China and Russia in 2011

October 8, 2010 06:01 CET

(Bloomberg) -- Saab Automobile aims to start selling cars in China, Russia, Brazil and Mexico in the first half of next year, its sales chief said in an interview.

Saab, the Swedish automaker owned by Spyker Cars NV, is negotiating with potential distribution partners in the four countries and aims to reach agreements by the end of the year, said Adrian Hallmark.

“In the next two years the new markets will not materially change our performance volume-wise, but in the next five years I believe they will fundamentally change our performance,” Hallmark said.

General Motors Co., which sold Saab to the Dutch super-car maker in February, halted its imports of the Swedish brand into China and Russia during the economic crisis that started in 2008, Hallmark said.

Saab, on the brink of shutting down before Spyker bought it, aims to become profitable by 2012. While the company is now focusing on re-establishing itself in the United States and Europe, growth markets such as China will be key to its long-term success, Hallmark said.

In China, Saab is talking to “numerous potential partners,” including Beijing Automotive Industry Holding Co., which last December bought technologies from Saab for about $200 million. “BAIC is part of the process but they're not the guaranteed distribution partner, far from it,” Hallmark said.

For now Saab is only seeking a distribution deal in China, and next year it may study whether local production would be feasible, he said.

“If we only import cars to China I think we can sell 2,000 to 5,000 cars a year,” he said. “If we build cars in China it could be 50,000-plus cars per year.”

Saab sold 860 cars in China in 2008, the last year it had a presence there.

Indian market

Hallmark declined to identify any other potential new distribution partners. For Russia, Saab is holding discussions with four candidates, while for Brazil and Mexico it's talking to a total of 15 companies, said Hallmark, who joined the automaker in March from Volkswagen AG, where he was executive director for Asia.

Saab also aims to enter the Indian market in the second half of 2011, he said.

The key to expanding sales in these markets will be Saab's new 9-3 model, a mid-sized sedan scheduled for release in 2012, Hallmark said.

“Until the end of 2012 we want to get started, get the right business partners and then have a real growth strategy based around the launch of the new car,” he said.

Read more: http://www.autonews.com/apps/pbcs.dll/article?AID=/20101008/COPY/310089998/1198#ixzz11mVLc6l2

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