Editorial Archives - Page 4 of 9

MoU with Youngman, Pangda has expired, but talks continue

Today’s the day the Memorandum of Understanding that was signed on October 28 expires.

There might be some uncertainty as to what that will mean for Saab today. In short, whilst the MoU does indeed expire, all parties to that deal have agreed to continue talks.

General Motors, who must approve any sale of Saab under certain conditions, indicated that they would not accept a sale of Saab Automobile as per the terms of the MoU. Therefore the parties involved are negotiating to determine conditions that GM will accept.

As has been previously reported in the media, information has been sent to GM outlining Saab’s proposed business plan and intentions for the future, as background information for any further change-of-ownership proposals put before them.

Waiting….. (still)

It’s the beginning of what will surely be another big week in the history of Saab Automobile. I think I can speak for colleagues here at Saab and say that we’ve seen some wonderful things in the last few weeks – the support and happiness of people attending the dealer tours, as well as the recent and spontaneous gestures of support on several other fronts as well. We truly appreciate it.

I just wanted to quickly refer back to something that I wrote last week in a post called Waiting.

There’s no reason why Saab Automobile has to succumb to the circumstances that have plagued it this year. As I mentioned a few days ago, Ford managed to get a similar deal done to give Volvo a future. I think it can be done here, too. We still have a lot of very good reasons to be here in this industry. If there is goodwill in the room, there will be a way to work this out with an agreement that will work for all concerned.

I’d now like to invite you to read the Editor-in-Chief of one of the most important newspapers in the automotive industry, Keith Crain from Automotive News:

….GM should look at how Ford handled the situation when it sold its Swedish company, Volvo. That seemed like a very civilized transfer, and Ford acted gentlemanly the whole time. That might be something GM should study.

I’m not playing favorites. But if Saab is to die, it should happen in the marketplace, not in some corporate boardroom without even a fair hearing.

We have no plans that include dying. We just want to bring our new vehicles to market and knock a few people’s socks off.

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This week, Saab will have to try to extend its MoU with Chinese partners Youngman and Pang Da, as well as continuing negotiations with General Motors about what will constitute an acceptable deal in their eyes.

There is an important deadline looming with regard to our reconstruction procedure (on the 22nd), so time is precious.

As written above, I hope there is plenty of goodwill in the room. There has to be a way to work this out.

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Press release: Update On Proposed Sale Of Saab Automobile And Saab GB

Trollhättan, Sweden: Swedish Automobile N.V. (Swan) and Saab Automobile AB (Saab Automobile announce they have taken notice of a press statement issued by General Motors Company (General Motors) today regarding the proposed sale of all shares in Saab Automobile and Saab Great Britain Ltd. (Saab GB) to Pang Da Automobile Trade Company Ltd (Pang Da) and Youngman Automotive Group Company Ltd (Youngman).

Swan and Saab Automobile acknowledge the position taken by General Motors and will now discuss with Pang Da and Youngman to see whether a structure can be agreed which is acceptable to all parties concerned.

Is the internet slowly strangling the car industry?

This might seem like a strange topic to write about, given that I now earn my living writing about a car company on the internet, but sometimes you’ve just got to roll with these things when they come to you.

Last week, here in Australia, we had our biggest horse race of the year: The Melbourne Cup. It’s referred to as ‘The Race That Stops The Nation’ and it’s no mere boast. All around the country, workplaces grind to a halt at 3pm to watch the 24 nags run the 2-mile course. For the bookies, it’s the biggest betting day of the year. At Flemington racecourse itself, well over 100,000 people cram themselves in, dressed to the nines and gulping down chicken and champagne for breakfast, then just champagne for the rest of the day’s meals.

The event is almost as much about fashion these days as it is about horseflesh. If your idea of entertainment is seeing a flock of loaded, but very well dressed women sitting in a gutter, shoes-off and dishevelled, head down to Flemington around 6pm during the Spring Racing Carnival. It’s surprisingly entertaining, but back to the race……

I joined in and watched The Cup on television. I didn’t have any money invested, but you want to be able to talk intelligently about the race when one of your friends calls or emails you to tell you about his/her winnings.

Something that I saw on the TV coverage really made me sit up and take notice. After the race, the winning horse was brought to the presentation area along a path going right through the crowd. As I watched this, it struck me how many people were holding up their smartphones. The crowd wasn’t a huge wall of cheering suits and frocks as you might imagine. It was a wall of raised arms and gadgets, with everyone watching the magnificent animal that was little more than six feet in front of them through a tiny 3-inch screen. This photo doesn’t quite do it justice, but you’ll get the impression.

Photo: The Age

I saw this video earlier today, and it reminded me of the Melbourne Cup scene and the way instant communications and social media have changed the way we live. It’s a US comedian named Louis CK talking about his Twitter account (less than 2 minutes, but funny and quite true):

The point, and the question(s):

Has our recent obsession with ‘connection’ and gadgetry reduced our aspiration for actual experience? And has the market for providing that instant connection taken precedence over the experience/product it’s covering?

Continue reading Is the internet slowly strangling the car industry?

What I learned about selling cars in the US, from the top-10 selling cars in the US

I got this article in my inbox from million-mile Saaber, Peter Gilbert. I don’t always get time to read every link that lands in my mailbox, but it’s a weekend and seeing the top 10 list for the US did hold some interest. And it did get me thinking.

Here are the top 10 selling vehicles for the US so far in 2011, as listed online by Forbes:

10. Ram pickup

9. Chevrolet Cruze – Chevy’s new small car has strong sales momentum.

8. Toyota Corolla – Corolla is down 11% this year amid tougher small car competition and dealer shortages.

7. Honda Accord – The only Honda model still in the top 10 due to inventory shortages.

6. Ford Fusion – Ford’s mid-size sedans have led a product revolution at Ford.

5. Ford Escape – Escape sales stayed strong, even with a redesign on the way for 2012.

4. Nissan Altima – Nissan’s mid-sized sedan shot up the list as other Japanese makers struggled.

3. Toyota Camry – Camry is still the nation’s best-selling car, and a redesign is coming for 2012.

2. Chevrolet Silverado pickup – Chevy pickups are overdue for an update, but still selling well.

1. Ford F-150 pickup – Ford’s workhorse pickups are the perennial best seller.

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Now, I may be learning the completely wrong lesson here, but here’s what I saw in that list.

The most popular cars in the US are rather boring, vanilla sedans that are sold on a combination of features and price, with price being a big driver. None of the cars in that list are going to get anyone’s heart racing. They’re not going to turn any heads. They sell because they deliver what customers expect – a price-driven transportation appliance.

Fair enough.

The trucks on that list each have their own loyal following and sell on a combination of price and functionality. They hold a promise of delivering a certain degree of utility and they have a place in the semi-modern American automotive tradition. The fact that the F150 has been the best selling vehicle in the US since Adam wore short pants tells you just how deep that tradition goes, and how well Ford keep delivering on that F150 promise. The F150 is pretty much a brand in itself nowadays.

Both sets of vehicles, cars and trucks, make certain offerings to their customers. The customers know what they’re going to get, whether it’s a boring sedan or a functional pickup. They’re buying transportation, or reliability, or functionality. Whatever the promise is, the vehicles in the list deliver on it at a price that’s suitable for the American consumer (the most price-driven consumer on the earth, in my experience).

So that’s the first thing that stuck out to me – something we all know, really, but it stared me in the face as I looked at this list: You’ve got to have a brand/sales promise that you can deliver to your prospective clientele. Price is important, especially in the US, but delivering on your promise is crucial (especially if you’re a niche brand like Saab).

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One company that’s not on that list, but may be by this time next year, is Volkswagen. They have a goal to increase their sales in the US by massive multiples and they’re on their way to doing so, recording a 40% increase in year-on-year sales in October, and recently being hailed as one of the most profitable car companies going around.

I made a video highlighting Volkswagen a few motor shows ago (in LA, I think, November 2011) where I famously described their stand a Das Boring (which it was). They’d just re-packaged their vehicle range in such a way as to drive down their list prices, de-contenting them like crazy (drum brakes?!) and they took a fair bit of criticism in the automotive press for doing so. They weren’t worried, though. Perhaps what they’ve learned, something that a few others haven’t yet, is that the first online price comparison is crucial in keeping you on a US shopper’s list.

Maybe this is something else that we have to learn. Saab will never be able to sell on price alone like Volkswagen can. That’s not where we are and as a small car company, it’s not likely a place where we’ll ever be. But maybe there are some things that we can learn about how we package vehicles and present them to the market.

Volkswagen have de-contented the heck out of their standard offerings but from an industry broadcast I saw last week, they’re still selling at very similar transaction prices to what they used to. People who are drawn in by the competitive list price are optioning them up once they see the car in the metal at the showroom.

Can we sell Saabs the same way? I’m not sure, but it was definitely food for thought for me on a lazy Saturday morning.

A brief thought, courtesy of GM

I read this in the Wall Street Journal this morning:

STOCKHOLM (Dow Jones)–The former owner of troubled Swedish car maker Saab Automobile AB, General Motors Co. (GM), said Friday it would have a difficult time supporting a change in ownership of the company based on the information at hand.

“GM would not be able to support a change in the ownership of Saab which could negatively impact GM’s existing relationships in China or otherwise adversely affect GM’s interests worldwide,” said GM spokesman Jim Cain.

My brief thought as a Saab fan who’s followed this journey closely for nearly two years straight now:

Ford found a way to let Volvo keep going and protect its interests. So can you.

My hope for all the people on our side of the table….. Keep talking. Find a way. Never, ever give up.

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Something I just added in comments that I figured was appropriate to state here, as well:

GM have legitimate interests to protect. No-one’s arguing with that. But that doesn’t mean that those interests can’t be protected. Things can always be worked out where there’s an interest in doing so. I just hope GM have same view as the rest of us – the world is not a better place with Saab gone, and there’s no threat from Saab to their business.

A new week begins for Saab

It was good to have a weekend to get away from things, to recharge a little and come back ready to tackle all the things waiting to be done. Monday morning is upon us and it’s a new week, and another big week for Saab Automobile.

Our Memorandum of Understanding with new prospective owners Youngman and PangDa was signed just last Friday and today that MoU will see its first test – a creditors meeting at the Vanersborg district court. This hearing is a standard part of our reorganisation process and it will see our business plan presented by our Administrator, Guy Lofalk.

We need the approval of 75% of our creditors to see the plan proceed and if that it achieved, our reorganisation will continue.

That will be a good first step. There are a number of other steps to be taken and approvals to be gained before our future is set in stone. There are several Swedish authorities that need to approve this deal, as well as the European Investment Bank, our former owner, General Motors, and of course there is still Chinese approval required from the NDRC.

All of these bodies will be dealt with methodically and in due course. Each represents a hurdle of a different size, however we’re confident that we can present a workable case to all of them.

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I started working at Saab at the beginning of April this year and the story of this company has had so many twists and turns since that time. ‘Twin Peaks’ creator David Lynch couldn’t have come up with a more twisted storyline if he tried. It would be a little bit naïve to think that absolutely everything was tied up neatly right now, but hopefully the remaining curves on this road are gentle ones.

Already, there have been some good stories coming into my inbox. Signs of a ‘Saab Spring’, if you don’t mind the metaphor.

Saab of North Olmsted embarking on the biggest dealership promotion I’ve ever encountered with the Snap Up a Saab campaign that will run throughout November.

A guy I’m familiar with from my old website, Saabs United, writing to me for wheel and tyre advice for the 9-4x he’s importing from the USA into his home country.

And the continuation of the Saab Dealer Tour through Germany, which I’m desperately disappointed that I can’t participate in personally, and which I’ll share some more photos from shortly.

We have so much to do, and so much to share. We’ve got so many good things on the horizon. I can’t wait to have this deal put to bed so that we can get back to building some absolutely fantastic vehicles once again.

It’s a new week. The ride isn’t over yet. It’s just beginning.

Thoughts on the sale of Saab Automobile

The deal to sell Saab came through in the late afternoon for me here in Australia. There were a couple of conference calls back to the office and a few emails here and there, just to try and share the moment with my colleagues back in Sweden. It’s hard being so far away, sometimes.

I wanted to provide some personal thoughts in a more timely manner, but bottom line……. I had to sleep on this one.

Right now, I have mixed feelings for a number of reasons. They’re much more positive than negative, but I can’t say it’s a case of parades and marching bands inside my head right now.

Strap in. This is another long-ish one.

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The good news – the overwhelmingly good news – is that Saab survives and gets a chance to fulfil the promise that it’s had for the last couple of years. I forget the number of times that I’ve spelled out exactly why Saab should be given this chance, but it goes a little something like this:

Product: We have the biggest product portfolio we’ve ever had, with cars that are going to meet the marketplace better than ever, and more new product on the way very soon. Some of the technical innovations we’ve got coming are very, very exciting indeed. Some will be firsts for Saab and some will be world firsts. I’m so very happy that Saab fans will get the chance to see them.

Continue reading Thoughts on the sale of Saab Automobile

Thoughts on today’s press release – cessation of agreement with Pang Da and Youngman

My first thought was to recover from the punch in the face it felt like I’d just received.

It was a blow, for sure.

The agreements that Swedish Automobile made with Pang Da and Youngman promised much in terms of future development for Saab. To have those agreements end in a flurry of last-minute activity like this is disappointing in the extreme. As employees, I think I can say that we all had faith in those agreements and what they could mean for the future of the company.

It’s a difficult blow, especially given the time constraints that the company faces. It’s not terminal, though. If you think you can write the script for the scenes that are to follow in this drama, then you haven’t learned a thing in the last six months.

A few things to remember here…..

Swedish Automobile NV had binding agreements in place, which it honoured exclusively with the parties involved, excluding other parties who were interested in the company. With the dissolution of these agreements, that exclusivity is now gone and there are others interested in what Saab have to offer.

Swedish Automobile NV has a board and a supervisory board who took this decision for considered reasons. It is not, as one automotive writer suggested, a matter of them wanting to have their cake and eat it, too. There are multiple stakeholders in this and the offer made to take over Saab didn’t reflect the value in the company, nor did it reflect the agreements that went before it, some of them less than 10 days old.

Saab doesn’t have a debt crisis. We have a liquidity crisis. Our debt is manageable if we are producing and selling vehicles. In that scenario, the value in the company is much greater than our present market capitalisation.

We are a fantastic company, building great cars designed by fantastic people and we have a market for them. What we don’t have at this second is the lubricant needed to get the machine moving – cash.

There are other entities out there who recognise this and will be attracted to investing in Saab and that scenario is better than a lowball offer such as the one that our board has just said no to.

We have time pressures, for sure. But it ain’t over yet. Not by a long shot.

A personal thought, part 2

Please excuse me whilst I air out some thoughts here (again)……

If you’ve been following my writings for even a little while, you’ll know I have certain…… issues….. with some elements in the automotive press. There are some newspapers, especially in Sweden, who I like to question about their approach to Saab, for example. This concern of mine isn’t confined to the print media, however.

What I’d like to take issue with today is the class of automotive media out there who have taken it upon themselves to actually wish Saab dead.

My questions to them are as follows:

Almost all of the people I’ve met in the professional automotive media sector are car people who happen to be in the fortunate position of working in the field that they love. They have their favourites, but by and large, they appreciate cars from all different makes. They have an incredible, detailed knowledge of automotive history – who made this, who designed that, and when – and yes, they also read the news. Almost without exception amongst the people I’ve met in this field – the automotive professionals – they’re rooting for Saab to survive, even if it’s only quietly.

Why aren’t you?

Is the fact that you are a self-ordained automotive analyst more important to you than the health and diversity of the industry you cover? Is your need to be on the right side of happenstance so crucial that you are compelled to be visible, stating loudly every prediction that the bookies would favour?

I’ve said it numerous times before, even just a few weeks ago, that the automotive world would be no worse off if it didn’t have another 100,000 Brand X motor vehicles. But it’s a much better place if we can carry on and make 100,000 Saabs a year.

The automotive world, like so many other sectors of the world we live in, is being legislated into a sameness that is slowly chasing away the passion for cars that was previously held close by so many people. This industry needs diversity. It needs creative thinking from different companies in different parts of the world.

I have no personal interest in the vehicles made companies like Nissan, Audi, Peugeot or Kia (amongst many others). But I would never begrudge them their place in the industry or actually wish them gone from it. Their presence in the industry and the competition they provide, the innovation that that competition drives, and their different takes on styling and packaging are what makes this industry interesting. It’s what makes companies improve.

If you’re really a car person, you get that. You understand. You love your brand, but you appreciate what’s there in others, too.

There is a market for Saab in the automotive world. We can trade on design and a blend of packaging, safety, technology, performance and utility that is unique to us. Saab being present in the automotive world doesn’t hurt anyone. It makes a contribution.

Wishing Saab away from the automotive world does nothing more than make an already too homogenous image look even more dull.

So why would anyone do it? Simply to be seen as being right?

What a victory that would be. And what a cost paid by others to achieve it.

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Apologies again if this seems a little downcast and gloomy.

I remain, as always, convinced of Saab’s future as a car company, simply because we have too many good things happening, too much good product and too many good people, to simply have things fall by the wayside.

I just get annoyed by some of the things I read and the thought that others out there would be reading them, too.

Some will assume that this post is aimed at certain websites or individuals. It’s not. There’s a whole class of sites out there playing the same broken record – looking at analysis rather than looking at the product, or the product plan. It’s aimed at the class, not the individual.

Hopefully this has cleared my head, and we can get back to car stuff in the next day or so 🙂