Automotive Academy

After months of speculation GM has pulled the plug on Saab, which has left the loss-making Swedish car company no option but to file for ‘Chapter 11’-style bankruptcy. The move means a Swedish court-appointed administrator will oversee efforts by Saab to reorganise itself once more into a fully independent entity, while offering short-term legal protection from its creditors, which will give the car firm the opportunity to try and get itself back on its feet and get protected against bankruptcy. 

However the company has reiterated it can only survive as in independent in the future with significant external funding, it has been reported that last year the company lost nearly £250 million.

‘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.’

The company produced a press release today putting on a brave face in regards to the situation, stating Saab’s intention to re-concentrate the marque’s design, engineering and manufacturing operations in Sweden over a three month period, assuming the administrator agrees to the plans. But in the meanwhile the GM decision which was made to cut Saab loose has put the Swedish government under increasing pressure to stump up a taxpayer bailout.