China's Youngman hopes to salvage parts of Saab, Pang Da withdraws
Saab's PhoeniX concept at the Geneva auto show earlier this year.
Photo credit: GREGORY ROBINSON
TROLLHATTAN, Sweden (Reuters) -- Chinese car company Zhejiang Youngman Lotus Automobile clung to hope on Tuesday it might salvage parts of bankrupt Saab as Swedish media mourned the passing of one of the country's best known brands.
Swedish papers pointed the finger of blame firmly at General Motors, Saab's former owner and holder of vital technology licenses, while in Saab's home town in south west Sweden, locals were stunned by the end of 64 years of car making.
But the year-long saga that has seen Saab owner Swedish Automobile's CEO Victor Muller scour the world for a saviour for the company may not be over.
Youngman, whose attempt to buy the Trollhattan-based firm was blocked by GM, said it remained interested in a deal even after a court on Monday declared Saab bankrupt.
"I feel as if the discussions and plans that took place between the Saab management and Youngman may well be realized even at this stage, but excluding the technology that GM provides," lawyer Johan Nylen, acting as Youngman's representative in Sweden, told Reuters.
He said Youngman was interested in Saab's "Phoenix" platform, which was supposed to be the base for the next generation of Saab cars.
GM provides about 10 percent of the parts for the new platform, according to Saab's CEO, but Nylen said Youngman plans to develop those parts themselves, meaning GM could not wreck a deal.
"It will be done by developing the parts that GM provides in-house instead. Then it will be completely decoupled from GM," Nylen said.
Pang Da withdraws
Completing the development of the Phoenix platform will be costly and long -- one or two years, according to Nylen. Even then, any new owner will have to get permission from defense and security company Saab AB and truck maker Scania to use the Saab name because they own the rights.
China's Pang Da Automobile Trade said on Wednesday it would halt its attempt to acquire Saab in light of the bankruptcy.
"In view of Saab being declared bankrupt, Pang Da Automobile Trade has decided to stop the acquisition transaction of Saab," Pang Da said in a statement to the Shanghai stock exchange. Pang Da said in the statement that it would follow relevant procedures to try and retrieve the 45 million euro ($59 million) advance it had given to Saab, but warned that it may not be successful. As late as early December, Pang Da was optimistic about a rescue, saying it was still in talks with various parties including Saab on plans to invest in the firm.
"In view of Saab being declared bankrupt, Pang Da Automobile Trade has decided to stop the acquisition transaction of Saab," Pang Da said in a statement to the Shanghai stock exchange.
Pang Da said in the statement that it would follow relevant procedures to try and retrieve the 45 million euro ($59 million) advance it had given to Saab, but warned that it may not be successful.
As late as early December, Pang Da was optimistic about a rescue, saying it was still in talks with various parties including Saab on plans to invest in the firm.
Saab's bankruptcy came after owner Swedish Automobile failed to stitch together a financing deal with Youngman. Saab's production line has been idle since early this year after it failed to pay bills to its suppliers.
GM apparently rejected Youngman's offer because it wanted to make sure the technology it licences to Saab would not get into the hands of a competitor for its Chinese partner, SAIC Motor Corp Ltd (Shanghai Automotive).
In the town of Trollhattan people were still taking in the news of the demise of a key employer.
"It is extremely sad and I do not think it had to happen. A few years ago, when this started, the government should have done more, as they did in Germany and the USA with its car industry," said pensioner Birgitta Forsbohl.
"This is not just about Saab, it's about all subcontractors and local businesses as well ... I don't think there will be any more auto industry here in Trollhattan. That era has gone to the grave."
Muller on Monday blamed both GM and a court-appointed administrator for wrecking Saab's survival chances. GM's spokesman James Cain said on Monday the U.S. group had helped the firm over many months.
Sweden's media was unforgiving.
"It was GM that killed Saab. Steady opposition to a Chinese buyer doused the final flickering hope," daily Dagens Industri said on its front page.
"GM was the final drop which drowned Saab," added Svenska Dagbladet on its front page.