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GM to close SAAB

Publication: 
Editorial Staff
chiefofficersnet

After almost a decade of losses as GM moved SAAB from its quirky but profitable models to standardised boxes built from the GM parts bin, the final attempt to save the company has failed. As Spyker dropped out of negotiations, GM says it is starting a wind-down of operations.

Last year, SAAB lost a little over GBP250 million - and it only produced 93,000 cars.

The problem for SAAB was simple: it's a low volume specialist car maker, that got swamped by mass-market management ideas.

GM's idea was simple: make the cars appeal to a much larger market than previously, and do it by "dumbing down."

But SAABs were never before dumbed down: they were built to exacting standards and with a feature-set that many thought somewhat agricultural, the beauty of a SAAB was to be found by one person: the driver. Changing that specialism into a car for sales-hacks and a family runabout immediately alienated the brand's extremely loyal customer base. One family simultaneously had three SAABs ranging from the 99 to the 9000T16.

But as GM moved in, the 9000 changed and, because Americans couldn't get their heads around the idea of a large car with a two litre engine (even one with a Turbo so as to generate about 200 bhp) a much heavier, much less fuel efficient and much less enjoyable to drive behind 3000 litre injection engine was shoehorned in.

That was the beginning of the end for SAAB: the next generation were basically Vauxhall-Opel cars with some SAAB bits in.

But the aircraft-cabin like dashboard was gone, and so was the sense of being in something special.

The amazingly ugly 9-4X was a total waste of money: why GM wanted SAAB to build an SUV is anybody's guess - although its not hard to see that the lemmings in the US Automotive industry will have seen the Porsche, BMW, Volvo vehicles and thought they could jump on a bandwagon: but it was a bandwagon that was overloaded and doomed.

And a last ditch attempt to regain lost custom by making fast versions of the 9-3 and the 9-5 did not woo back those who felt SAAB had lost its character.

For true SAAB fans, the brand died almost a decade ago.

Except that, with immense irony, GM finally recognised the error of its ways last year. They told SAAB to go and build a car, largely without interference. It was listed for testing in mid 2010 and sale mid 2011, insiders say. And it was a proper SAAB. The designers and workforce were excited; dealers were looking forward to it and SAAB devotees were salivating.

But with no deal to salvage SAAB, and the Swedish government adamant that it will not nationalise the company, it looks like it's all over.

But it might not be. Last week, it was announced that Beijing Automotive Industry Holdings had bought the existing line, power train and tooling for the 9-3 and the current model 9-5. What SAAB is left with now, mostly, are new models in the pipeline.

GM dodged or flat out refused to answer questions as to why the proposed deal with Spyker collapsed other than to say that things are learned during the due diligence process.

John Smith, GM vice president of corporate planning and alliances said "We're going to begin the wind-down process. It is possible that during the wind-down, any number of people could come forward and express interest. There were vehicles that are in development that I imagine would be attractive to some folks, but that has not been our focus. I can't rule it out, but the clock starts now as we start the wind-down process. Our ambition would be to wind it down as quickly as possible."

Amongst those "folks" may be Beijing Auto: it had plans to work long term with SAAB on engine development, something the Chinese company is weak on. There may just be a chance to get the whole skill-set on the cheap, and that - for Beijing Auto - is not something to be sneezed at. Especially as it should come with a range of new - and real - SAABs close to release.