Chinese Partner Throws Saab Another Lifeline

2011 Saab 9-5Saab used up another of its nine lives today as the company announced a new partnership with a small, private Chinese car company, according to USA Today. Hawtai Motor Group bought a 30% interest in Saab in exchange for $223 million.

Saab has been shut down for nearly a month because it lacks money to pay for the parts it needs to build its vehicles, USA Today reported. Before the recent turmoil, Saab was threatened by the bankruptcy of former owner General Motors before the big American carmaker reached an agreement with small Dutch boutique carmaker Spyker. Ever since, Spyker has struggled to keep the lights on.

Along with the new money from Hawtai and a short-term loan from an investment fund, Saab will now have enough money to restart production of 9-3 and 9-5 vehicles. Despite the lull in production, Saab has plenty of inventory in the U.S. is showing some 2,602 new Saabs at its estimated 130 dealerships. That’s equivalent to 141 days of inventory, the highest in the industry, according to Ward’s Automotive. A new 9-4x crossover was supposed to go on sale this month, but we don’t know if that model has been delayed. A Saab 9-5 SportCombi is scheduled to come to the U.S. this fall.

The deal still needs to be cleared with European and Chinese authorities, but Saab expects the agreement will clear regulation hurdles in six to 12 weeks.

Saab Buys Time by Selling 30% to Tiny Chinese Carmaker (USA Today)



Cool. I hope they make it. It's an iconic brand. Maybe they should just share platforms with Volvo and get on with it.


Saab is a dead duck. They need to stop throwing money at it.


As the Japanese economy grew in the 1980's, this same pattern of behavior emerged. Japanese firms often bought American or European brands, paying far too much for a dysfunctional company. These were huge money losers for them, and they tied up a huge portion of their capital in companies that were past their prime and part of an old economy. American investors poured their money into tech companies and start-ups, investing in the future and made it big. It appears that Chinese have yet to learn from their Asian compatriots the lessons of the past.


They are nice looking cars, but too expensive for me.

Amuro Ray

@ Dan,

I suspect that your reasoning is what motivate Hawtai to buy Saab. Rather, it's the abundance of US currency that the Chinese gov't has right now, only to see it devaluating due to our Fed & QE2. What's better way to NOT lose more value? Spend it.

Buying Saab is "better" than let the US$ sits in the Chinese Central Bank's vault and do nothing...



True that the Chinese have been shifting the use of their dollars from debt to equity as of late (just as Japan did in the '80s), but so far they aren't making good choices with it. If you're investing in a company that is losing value, it actually WOULD be better to let your money sit in the bank, even with the (so far) minor impact from currency devaluation. The choice to overpay for failing companies is still a big money losing proposition. They should be looking at cutting edge companies with solid potential that are building the products of the future, as should we all.


I just don't see the benefit of pouring money into this failing company with NO exciting products to come. The 9-5 is a yawn and easily outclassed and outperformed by Infiniti, Audi, BMW, etc. Saabs are over-priced and BORING.

This same thing almost happened to Volvo, but I guess whoever owns Volvo put a great deal of money into the company and the first new product resulted in the S60; which is an excellent vehicle. At this point, Saab doesn't have anything like the S60 and I don't see them around for much longer.

nice article........

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