General Motors confirmed this morning that Saab's days as a part of the Detroit-based company are numbered. The Swedish brand has filed paperwork with courts in its home country for reorganization that would lead to its independence. This self-managed reorganization is analogous to the U.S. Chapter 11 bankruptcy process, and would lead to the establishment of an independent entity based in Sweden. In order for that to happen, however, GM needs to line up financing for the new company, which may be problematic. Automotive News reports that as much as $1 billion may be needed to make Saab sustainable on its own.
GM plans to concentrate Saab's engineering, design and manufacturing operations back in Sweden. The brand plans to launch three new products between now and mid 2010: the new 9-3X, 9-5 and 9-4X. The first two are already set to be produced in Sweden, but the new 9-4X crossover was scheduled to be built in Mexico alongside the Cadillac SRX. The Swedish government has already rejected a GM request for funds, so the money will have to come from somewhere else. The official press release from GM can be read after the jump.
[Source: General Motors]
PRESS RELEASE
SAAB ON THE ROAD TO INDEPENDENCE
- Swedish court process to reorganise Saab into a fully independent business
- Three new models ready to be launched over the next year and a half
- Saab aims to bring resources back to Sweden
- Funding sought for 'new independent Saab'
Trollhättan. As a result of GM's strategic review of the global Saab business the Saab Board announced today that it will file for reorganisation under a self-managed Swedish court process to create a fully independent business entity that would be sustainable and suitable for investment.
The reorganisation is a self-managed, Swedish legal process headed by an independent administrator appointed by the court who will work closely with the Saab management team. As part of the process, Saab will formulate its proposal for reorganisation, which will include the concentration of design, engineering and manufacturing in Sweden. This proposal will be presented to creditors within three weeks of the filing. Pending court approval, the reorganisation will be executed over a three-month period and will require independent funding to succeed.
"We explored and will continue to explore all available options for funding and/or selling Saab and it was determined a formal reorganisation would be the best way to create a truly independent entity that is ready for investment," said Jan Ake Jonsson, Managing Director for Saab Automobile. "With an all new 9-5, 9-3X and 9-4X all ready for launch over the next year and a half, Saab has an excellent foundation for strong growth, assuming we can get the funding to complete engineering, tooling and manage launch costs. Reorganisation will give us the time and means that help get these products to market while minimising the liquidity impact of Saab on GM."
Funding for the restructured company will need to be secured during the reorganisation process and will be sought from both public and private sources.
Saab will continue to operate as usual and in accordance with the formal reorganisation process, with the Government providing some support during this period. The reorganisation should have no impact on other GM operations. Details of the progress will be provided as milestones are achieved.
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