REPORT: China's Beijing Automotive takes minority stake in Saab
2010 Saab 9-5 - Click above for a high-res image gallery
It had been reported that SAIC had quietly taken a stake in Saab in conjunction with the Koenigsegg Group. However, it's been confirmed that Beijing Automotive -- which also recently made a play for Opel -- has grabbed a share of the Trollhätten pie.
BAIC provided the $400 million difference in cost that Koenigsegg needed to complete the sale and the final financial hurdle is for the Swedish government to guarantee a $600 million loan from the European Investment Bank to Koenigsegg.
Those kinds of numbers mean that Saab will be more expensive than Aston Martin, which might sound a little odd -- especially for a company that sold just 93,000 cars last year. But the tie to BAIC -- and Russia, Augie Fabela, a cell-phone company magnate -- could open up two enormous markets that will give Saab access to market numbers that could justify its purchase price and existence. Full press release from Koenigsegg after the jump.
Gallery: 2010 Saab 9-5
[Source: Koenigsegg]
PRESS RELEASE
Koenigsegg Group AB signs MOU with Beijing Automotive Industry Holdings Co. Ltd (BAIC) regarding SAAB Automobile AB
Koenigsegg Group AB has signed a Memorandum of Understanding (MOU) with Beijing Automotive Industry Holdings Co. Ltd. ("BAIC") to explore growth opportunities in the Chinese and international markets for the products of SAAB Automobile and BAIC.
Under the terms of the MOU, BAIC would become a non-controlling minority shareholder in Koenigsegg Group. Koenigsegg Group will own 100 per cent of SAAB Automobile AB. The intention is to conclude an agreement later this year. Due to confidentiality agreements signed, further facts cannot be discussed at this time. The Swedish Government has been fully briefed on the MOU.
"This is an important step on the road to a new SAAB Automobile. We have a solid business plan, an important partnership and we are now in a position to go ahead without any governmental financing," said Christian von Koenigsegg, CEO of Koenigsegg Group AB.
Koenigsegg Group now focuses on the ongoing discussions with the Swedish National Debt Office about the government guarantee for the loan with the EIB that SAAB Automobile has applied for.
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Reader Comments (Page 1 of 2)
MixiM 1:55PM (9/09/2009)
BAIC will have NO stake in SAAB. It's Koenigsegg group that will own 100% of SAAB. But with financial backing from chinese BAIC.
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MixiM 1:56PM (9/09/2009)
First!
the4thheat 11:05PM (9/09/2009)
But BAIC will own part of Koenigsegg, and if Koenigsegg owns Saab and BAIC owns a stake in Koenigsegg then they do indeed own Saab but by proxy.
Of course primarily they're just providing the funding but it would be inaccurate to say that they don't own any of Saab since they do by proxy.
matt234 1:59PM (9/09/2009)
Time for Swedish government to step in with some cash... for both SAAB and Volvo..?
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Aznauto 3:40PM (9/09/2009)
They know that for Volvo and Saab to remain competitive they need to move the lines to China.
matt234 3:49PM (9/09/2009)
@Aznauto
That may be true considering the current world economy, but by that argument cars could not be built at a profit in (for example) Germany, the U.S., Canada, or Japan either. Reducing production to match demand sounds like a more sensible solution than moving the production lines with all the problems that will come from that. When the world's economy starts moving I expect they will be fine (if they can survive until then).
Will 7:28PM (9/09/2009)
@matt
I'm not sure if Aznauto meant sell more cars in China (product line, not production line), which would make more sense in the context of the article.
It makes more sense to open factories in places where the economy is bad, so that it's cheaper to make stuff, and sell it in places where the economy is good, so you can sell more at higher price.
I would guess the deal with BAIC is mainly for their dealership network.
the4thheat 11:09PM (9/09/2009)
They're probably not going to be killing their Swedish production lines since that would be rather silly for Koenigsegg and the Swedish government to spend all this cash then, but if (and that's kind of a big if) Saabs do well in China I'm sure they'll have to use knock down kits or something to make the cars cost competitive with other manufacturers that manufacture locally.
I dunno how Saab is going to do in China but hey at least there's a ton of consumers there that probably don't have the negative impression a lot of people elsewhere have of Saab (usually regarding reliability)
TonyInMI 2:03PM (9/09/2009)
That new design is awesome! I've never been a Saab fan but this is really done well. Just a bit of retro, no crazy swept headlights, clean but slightly curvy lines - great job.
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Shiftright 2:09PM (9/09/2009)
Ditto. I've always liked Saabs for their engineering and quirkiness (pre GM, that is), and this recaptures the character they used to have but with a lot more mainstream elegance.
Rich 7:40PM (9/09/2009)
I agree. This is the first I've seen of the 2010 designs, and it's really nicely executed.
Watch and learn, Honda.
Shiftright 2:09PM (9/09/2009)
What is the display in the middle of the speedo?
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GML 2:30PM (9/09/2009)
It's a LCD color display, similar to the ones used in new Cadillacs. In one mode, it's a speedometer that looks like an airplane altimeter... Pretty cool.
hypermiler 2:16PM (9/09/2009)
@ MixiM
The correct way to say is that Koenigsegg would own Saab, and Beijing Automotive would own Koenigsegg in turn.
In exchange, Saab production would be outsourced to BAIC in China and BAIC gets full tech transfer of Saab vehicles.
In the future, Saab and BAIC's own brand models are going to be produced on same line in China.
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Swede 3:12PM (9/09/2009)
1. Wrong. Koenigsegg Group and the car manufacturer Koenigsegg are two different things.
2. Speculation. Yes, exporting cars to china make no sense, so cars for that market will either be made there or CKD'ed. But building a premium european car in china and exporting it to the west is inplausible.
stinkyboy 2:21PM (9/09/2009)
Love the new shape of the 9-5. I owned a 9-3 cabrio, loved the turbo rush. sorry I gave it up, but it had too many problems. after the warranty ran out, I traded it in for a chevy.... now that is a Sob story...
Hopefully, I get this new model in 2-3 years after the GM bugs are designed out.
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dave1w41 3:04PM (9/09/2009)
GM Bugs? SAABs were among the most unreliable cars on the planet before they were replaced with GM designs and the old 9-5 (which has always been a SAAB design) has been pulling down the average ever since. If this car is as good as the current Opel Insignia on which it's based, it's a perfectly fine automobile.
Farmboy 4:36PM (9/09/2009)
Honestly, I could care less about SAAB, although I do hope for the best. The Beijing Automotive stake could be important, especially for Chinese sales, and it is apparent how much the Chinese love luxury cars. The only thing wrong with SAAB is not a lack of market presence, they do that fine. I think the cars look like crap on the outside. The interior is stunning. Some of the best-looking in the auto industry. But that exterior, man, it looks like a retro-retard job.
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Rich 7:42PM (9/09/2009)
You could care less? So you care then?
Sheesh, learn the language or get another one.
chris 4:55PM (9/09/2009)
so what looks good in your opinion retard farmboy? A tractor?
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