General Motors will begin meshing Saab into its distribution network in as many as 20 markets worldwide once it completes its acquisition of all of the Swedish automaker, according to a Saab insider.
GM announced last week that it would exercise its option this month to acquire the 50 percent of Saab that it does not already own. Terms of the purchase were not announced, but GM has not denied reports that it will pay $700 million for the stake.
GM paid $500 million for its current stake in 1990.
'We have a lot of small markets where there are high distribution costs,' the Saab executive said. 'There are economies (to be had in) using the same distributors as GM.'
Saab's dealer network would not be affected, the insider said.
OUTPUT TO RISE
Last year, Saab produced 128,000 cars - almost equal to its 1989 volume, but still below its breakeven of some 150,000 units a year. Saab now expects production to rise to 200,000 by 2005, Saab Automobile AB CEO Peter Augustsson said last week at the North American International Auto Show in Detroit.
The increased volume will be spread equally between North America and Saab's traditional European markets, he said. Saab does not have plans to expand into Asia.
'We will focus on improving some of our traditional European markets which have suffered recently, such as the United Kingdom and Germany,' Augustsson said.
SUV ON THE HORIZON?
Augustsson would not comment on future product development, other than to say that design for all new Saab models until 2003 has been frozen.
He said Saab would give a glimpse of its future plans with concept models. 'They will be realistic, production-oriented models. But you won't see them in the near future,' he said.
The next Saab 9-3 is due in 2002. The upper-medium range will have five models, instead of the current three, a Saab official said. The range will include a three-door coupe, a five-door hatchback, a convertible and a model targeted at what the official called 'postmodern buyers.'
Augustsson said that model could be a 'wider-definition sport-utility, offering much flexibility to the lifestyle of its customers.'
Saab already uses GM platforms for its 9-3 and executive-model 9-5 ranges.
'We will turn the page so much more quickly and get new products on the market,' a Saab insider said. 'With only one owner, we'll get them much faster.'