Thoughts on Saab’s reorganisation application and rejection

Enthusiast first. Employee (close) second.

Like most of you who have been part of my personal journey with Saab, I thought we’d seen the end of the extreme ups and downs surrounding this company when it was sold by General Motors last year. The sale process was a tumultuous one, certainly busier than this in a media sense, but I have to say that it was a much brighter landscape to be writing in compared to what we’re facing now.

Back then, we had a rock-solid belief in the future of this company, it’s reason for being here and the potential for it to be a great, niche carmaker once again. A Saab company, independent from General Motors and backed to pursue its own ideas and technologies was (and is) considered to be capable of great things. As a community, we united behind the company because of a common goal and in some ways, a common ‘enemy’ that we saw in GM, who were threatening to close the company down.

This time, it’s a little different.

There are various parties who I think could share some of the blame for Saab’s current situation. I won’t go through them here because this isn’t the time for that and their individual contributions aren’t what got us here (although they certainly haven’t helped). The bottom line for a Saab fan is that we didn’t sell enough cars when we needed to, and that led to a cash shortfall that’s snowballed through various circumstances to land us where we are today. There is no common ‘enemy’ to unite against. The enemy lies within.

We have to change. Personally speaking, I still have a rock-solid belief in the future potential of this company, it’s reason for being here and it’s role as a great niche carmaker. I don’t waver from that at all. But we’re not there yet and we have to identify and make the changes necessary to get there. Yesterday’s filing was supposed to be a big step in that direction.

To change we need time. We have very supportive partners in China who were behind us all the way with this filing. We have plans in place to build a secure and profitable Saab with those partners, but we need a bridge to get us there. That bridge has two important elements – finance and security. We can chase the finance, no problems. But investors and/or financiers need the security. Our reorganisation filing was intended to assist in providing the stability we need. Stability to reorganise our business, secure the funds we need and safeguard our workforce (our biggest asset of all).

We believe in our business and we believe that we have the future product, plan, people and partners to make it successful. To have the court in Vänersborg look at our submission and decide otherwise today was a blow of the most severe kind. I’m going to leave the individual findings and comments in the judgment alone (Victor Muller covered them pretty well in today’s press conference) but suffice to say that if Swedish politician Maud Olofsson was surprised by today’s decision, then it really was a surprising one.

Of course, we will appeal. As has been mentioned already today, we prepared a submission for the court that we believed was well in excess of what they would need to approve this application. The court either disagreed, or just plain didn’t believe us.

That decision came at 2pm. By the time I walked upstairs to the executive offices at around 2:10pm, the executive team were well into their reading of the decision and the preparations needed for the next step on this company’s journey.

I’m sure the decision today flattened almost everyone at Saab. Everyone I saw and spoke to in the half hour after the decision looked just as shell-shocked as I felt. That’s not just the level of belief we had in our submission, it’s the belief we have and the desire that we have to see this company succeed.

When you hear about the (truly) sad story of workers not receiving their wages or salaries, please don’t think that it’s just factory or engineering personnel. All of the people that I saw today, working their tails off for this company, to get it back on its feet, are amongst those same unpaid workers. Yes, they wanted the reorganisation filing to work out because it would have helped them personally. Yes, they want the company alive so that they can continue their careers.

But more than that, the people that I saw today have been with the company for years and it’s almost like a family to the majority of them. They want it to work because they know what they’re capable of together. They know the hard work that’s gone into this place and they know that together, we were building momentum early this year before it all came tumbling down.

Saab is a fantastic company. We have the greatest people who do some absolutely amazing things. I was talking to a colleague today who’s been with Saab for a number of years. A few years ago, we were refused the resources we needed to bring our 9-3 range down to sub-140grams emissions levels because the people in charge of those decisions at that time didn’t think it was possible. Six months into our independence under Spyker ownership, we released a sub-120gram model. This is the sort of stuff we do, and we were just getting started.

Tomorrow is a new day. We have work to do and our stakeholders have decisions to make. We can’t make those decisions for them. All we can do is continue to commit every resource we have to making sure that our next step is a positive one.

Griffin up, people.

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  1. Well said, as usual, Steven.  Here is hoping the appeal works and/or a short-term bridge can be found to get Saab through to the future plans.

  2. Here’s one guy in the US whose heart goes out to everyone at Saab. You people are wonderful. I want you all to get the production line moving, for yourselves, for your families, for the automotive world, and to build be a new 9-5SC. 

    1. It’s not the end. Keep the faith, others too will see what VM, et al have seen as the upside potential to our great brand. Whether it’s a win on appeal and or other external funding, investment … will happen.

  3. well written again steven you moved me, i believe in that great company, keep up the good work it aint over til its over!

  4. If Saab had done the same thing every other company in crisis do, to cut down the number of workers, they probably would have came further (haven’t done the math, but I presume it’s a correct observation). However, if Saab wont be on their feets before bell rings, I personally think they did the best they could and ended it with much more dignity than people only interested in Das Kapital.

    Also, a motivational “Griffin up!” from me!

  5. Sreven,
    Well written as usual.I an no expert on the Swedish legal system, but having been involved in a couple of civil appeal cases, can say, they are far from easy…Truthfully, Courts’ could ask for more information [as stated today], but it is at the end of the day, for the applicants’ to make sure all the facts are provided….The ‘good’ thing, Is there is the possibility of a 2nd chance, and it must be filed fully,, the facts are the most important things, clearly addressed…..The other thing. in an appeal Court, there is usually 3 Judges, & the decision is, if not all in favor, 2 will do….So, a 66% chance, once the ‘permission to appeal’ is granted….But of course, I am trying to state, what VM already knows.. ” Is that a Griffin, I can hear Roaring”.

  6. Dear Vikings, don’t lose your faith! SAAB produced fantastic cars while so many others didn’t! The problem your company had and has have almost entirely came from outside. In my opinion your product is almost like an Apple Computer from 15 years ago. A fantastic product but completely underestimated by the broad market due to a bad board of directors which never really understood how to market the product. Maybe Steve Jobs will make a last but valuable investment and buy the shares of SAAB. He wouldn’t regret it.

  7. Very well written, Steve!

    Please keep taking notes. This will be an amazing read someday.

    Saab needs to survive. Not only for Saab, but for the rest of the auto-community. Where would Volvo be without Saab (or Scania, if you count the trucks)?

    Griffin up!

  8. “The man who achieves makes many mistakes, but he never makes the biggest mistake of all – doing nothing.” Benjamin Franklin.

    With that in mind add my support to the team involved in trying to secure Saab’s future. To all whose futures are tied in with that of Saab – Griffin up!

  9. I have always loved SAAB’s and last year finally bought my first one a 5yo 9-3 Vector Sedan. This is just a wonderful car to drive even with GM parts as I am told these arent always the best. I really want SAAB to survive ! I am a totaly fanatic, some call me mad! Totally in love with my SAAB something many other cars could never acheive. So here’s hoping to a brighter future for SAAB and all SAABites! Good on the workers for staying loyal, your a credit to yourself and the company.

  10. Your open hostility for GM did not help sell cars in the US. I have always felt this was a serious mistake. Many, many Americans have strong connections to GM. By stressing the ” they are the enemy” position, you damaged sales in the US. Other than that you have done an outstanding job. I have total faith Saab will survive in some form.    

    1. With all due respect, GM deserves what it gets. They made some huge mistakes that placed them in the mess they found themselves in two years ago, and here we are.  The unions didn’t help, either.  I don’t think that is an unusual sentiment here in the States, either. 

      Aside from that, I will never understand why GM did not invest more in SAAB or promote them in any useful way. Despite that, these are fun, quality cars that hold their own against any BMW, Mercedes, or Audi. My family and myself owned a steady stream of GM vehicles in the decades before we discovered SAAB (we all have SAABs now), and SAAB blows them all away. Yet GM treated them like the proverbial red headed step child.

      Regardless, all of that is in the past, the thing that matters is now.  Griffin up!

  11. Thank you Swade!   All my best wishes for the ongoing process. If Saab should not be worthy to survive, very few car-makers should. Keep up the faith and courage!

  12. I posted this on another blog yesterday, in response to a poll asking people to guess the date of Saab’s bankruptcy:

    When Saab goes bankrupt? Not within the next five years, at any rate.

    * On Tuesday September 13 the whitecollar unions will request that Saab be put into bankruptcy. (They will beat Metall to it.)

    * On Friday September 16, before the bankruptcy request has had time to result in anything tangible, the Court of Appeal will give its verdict. They’ll overrule the District Court and approve the request for reorganization. The bankruptcy request will then be withdrawn.

    * In the last days of September, Deutsche Bank will grant Saab a loan for SEK one billion. Reorganization boss Lofalk will decide that it’s in everyone’s best interest to use this money to restart production rather than to repay old debts. A month later, the production line squeaks into motion again. Cars start to be built, but sales are extremely slow.

    * Soon after the new year 2012, the Chinese will get their approval and buy a majority share for appx SEK two billion. In addition, they rapidly inject surprising amounts of money into product development, including a new 9-7 monster sedan, much bigger than the 9-5 and intended for the Chinese market.

    * In the following two years, Saab will make gigantic losses, and Swedish media will wallow in “I told you so” articles. To the surprise of many, Antonov makes a comeback in 2013 and buys a third share of the company. (The Chinese have repaid the EIB loan, so the Russian is now welcome.)

    * In 2015, Saab starts showing a profit, not least because of the bestselling fuel-efficient hybrid 9-3 (which for some reason is called 9-31 instead). But the backbone of the sales are in the Chinese and Russian markets.

    * New factories are now ready in Shanghai and Kaliningrad to meet rising demand in those markets, while Sweden builds for the rest of the world. In Trollhättan, there are now 3 000 more people employed at Saab than in 2011, and many more at the subcontractors as well.

    * In 2017, Dagens Industri will publish a whole supplement about the Miracle in Trollhättan, about how Saab turned around from the brink of doom into one of the most profitable companies in Sweden. However, in becoming modesty, DI will tone down their own part in the miracle, even though they were the only ones who believed in Saab all the way…

  13. Thank you for the update from the inside.  Good luck to all of you- I understand what you are up against, but I am praying that there will be a parting of the clouds, so to speak. You all have done an amazing job through all of this, and it has not gone unnoticed.  Please continue to keep us posted.

  14. This my be an odd question, but is there any chance under reorganization the employees could own the company by means of ‘sweat equity’ and other financial means ?

  15. we start again “SAVE SAAB” around the world to support V.M. in these difficult times make us feel so close …should not come to an end this story .. can not come to an end ..I’m italian ..