Chinese-Japanese group agrees to buy bankrupt Saab, build electric vehicles
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TROLLHATTAN, Sweden -- A Chinese-Sweden investment group with Japanese backing has agreed to buy bankrupt automaker Saab Automobile and plans to make electric vehicles, the winning bidder said today.
In a statement, the new owners and the bankruptcy administrator gave no details on how much the buyer, National Electric Vehicle Sweden AB, was paying for Saab or how much it would invest.
"The company will start a new operation in Trollhattan (home to Saab in western Sweden) where all development and production will be focussed on electric cars," the administrators said.
The first vehicle under the plan will be based on the company's 9-3 car, and the model will go on sale early in 2014, the statement said.
The buyer is led by Japanese investment firm Sun Investment and Hong Kong-based renewable-energy powerplant builder National Modern Energy Holdings Ltd.
Competing suitors for Saab included China-based Zhejiang Youngman Lotus Automobile, which was in talks since at least February and made a revised bid exceeding 4 billion kronor ($567 million) as late as June 8. The Saab administrators said early in 2012 that a half-dozen parties had shown interest in buying the company.
"Through the purchase of Saab we begin a new era in the auto industry," NEVS CEO Kai Johan Jiang told a news conference.
"Marketing and sales will be global but initially we will focus on China. It's there we see the biggest market for electric cars," added Jiang, who was born in China but has Swedish citizenship. He already has wide interests in power production from biomass in China.
NEVS said it aimed to begin building the new electric car at the turn of 2013-2014. A completely new model based on Japanese technology and a future Saab platform would also be made.
"Saab has risen again," said Paul Akerlund, the mayor of Trollhattan and a former union boss at Saab.
Despite his enthusiasm, NEVS chairman Karl-Erling Trogen said NEVS would initially need only about 200 staff, well below the 3,500 Saab used to employ.
The numbers would increase gradually as the launch of a new car approached, added Trogen, a former head of the trucks division at truck and construction equipment maker Volvo, a separate company from the Volvo car maker, itself Chinese-owned.
Not all assets bought
NEVS said it had bought most of the assets of the bankrupt estate, but not the spare parts business, which is now owned by the Swedish state after it repaid a loan on behalf of the old Saab. It also bought the rights to the Saab 9-3 and a development platform for future Saabs, called Phoenix.
But the rights for the Saab 9-5 and 9-4X were not included in the deal as these are still covered by licenses from GM.
GM has previously blocked deals to sell Saab to Chinese buyers, which analysts attributed to it wishing to protect its Chinese cooperation with state-run SAIC Motor Corp.
GM spokesman Jim Cain said the deal does not involve GM technology licenses if it covers only the 9-3 and Phoenix platforms. "The issues that were at stake revolved around the 9-4x and the 9-5 technology licenses," he said. "That was the big issue impacting the previous transaction."
NEVS said talks were still going on over the Saab brand, which was jointly controlled by the former car maker and the separate defence and aerospace group of the same name, from which the car firm split in 1990.
Jiang's National Modern Energy Holdings Ltd has 51 percent of NEVS while Japanese Sun Investment LLC has 49 percent.
NEVS said Sun Investment was owned by private investors, banks and companies and was formed to finance the development of Japanese environmental technology.
Saab, the maker of the 9-5 sedan and 9-4X crossover vehicle, hasn't built cars since last year following an initial production halt in March 2011. The carmaker was declared insolvent at the end of 2011 with debts of about 13 billion Swedish crowns ($1.8 billion), around 2.2 billion of which is owed to the Swedish Debt Office.
Trollhaettan-based Saab has been unprofitable for two decades, and General Motors Co., which acquired full control of the manufacturer in 2000, sold it in February 2010 to Dutch supercar maker Spyker NV.
The Saab administrators said early in 2012 that a half- dozen parties had shown interest in buying the company. Jinhua, China-based Zhejiang Youngman Lotus Automobile said in February that it was in talks, and it made a 4 billion crown ($567 million) offer last month, a person familiar with the situation said May 31.
Holding company
The Sun Investment bidding group formed a company called National Electric Vehicle Sweden AB with the purpose of buying Saab's assets, a spokesman said in May.
Saab had been struggling since at least December 2009, when GM announced it might dissolve the Swedish brand as it did with the Saturn, Hummer and Pontiac divisions in the United States. With sales peaking at 133,000 deliveries in 2006, Saab sold just 31,700 vehicles in 2010.
No sales figures have been released for 2011. Eric Geers, a former Saab spokesman who now works for startup Chinese carmaker Qoros Auto Ltd., estimated in February that the Swedish brand sold 10,000 to 15,000 vehicles last year.
Saab presented its first prototype in 1947 after moving out of aeronautical engineering and built a small, loyal following.
GM bought 50 percent of the car company in 1990 and the rest in 2000. It decided to sell the brand in 2009 after the financial crisis and almost closed it before Swedish Automobile, then called Spyker, bought Saab in January 2010.
Despite its well-known name, Saab was a niche player and analysts had questioned its future. It has the capacity to produce more than 100,000 cars a year running on two shifts.
Swedish rival Volvo, rescued by China's Geely Automobile Holdings Ltd. in 2010, made almost four times that last year.
Bloomberg, Reuters contributed to this report.
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