Saab To Die A Slow, Operatic Death
1993 Saab 900-T Convertible
As if GM's destruction of the brand by filling it with plastic weren't enough, as if GM's deciding it couldn't carry Saab any further weren't enough, now the right leaning Swedish Government has decided to let the brand die in long, tumultuous aria of political posturing and finger wagging. The New York Times reports:
... the Swedish government has responded to Saab’s desperate financial situation by saying, essentially, tough luck. Or, as the enterprise minister, Maud Olofsson, put it recently, “The Swedish state is not prepared to own car factories.”Although other car makers across Europe are being bailed out by their Governments, Sweden has apparently decided not to follow suit:
Such a view might seem jarring, coming as it does from a country with a reputation for a paternalistic view of workers and companies. ...
Sweden has a right-leaning government, elected in 2006 after a long period of Social Democratic rule, that prefers market forces to state intervention and ownership.
Swedish officials have condemned what they see as protectionism by other European countries that have pledged to prop up their own failing car industries. They have also been scathing about General Motors, Saab’s owner, and the last thing they want is to seem to be bailing out a despised foreign company.
Struggling for its own survival, G.M. has said it will completely pull out of Saab by the end of 2009, a course that Ms. Olofsson, the enterprise minister, described as tantamount to declaring “that they wash their hands of Saab and drop it into the laps of the Swedish taxpayers.”
She said: “We are very disappointed in G.M., but we are not prepared to risk taxpayers’ money. This is not a game of Monopoly.”
Saab lost about $343 million last year. It is now going through a Swedish process known as reorganization, a step short of bankruptcy, as it tries to persuade its creditors to prop it up while it looks for a buyer. Joe Oliver, a spokesman, said in an interview that “around six serious investors,” from Sweden and abroad, had expressed interest.
Put another way, with the Government refusing to step in, depending on what deal private investors can make for it, Saab is going slowly to expire in a sea of political arguments about whether the market's apparent decision on the brand is to be followed despite the dire consequences to the employees. The Swedish Government apparently thinks the market should have the final word. Meanwhile, 750 workers are being laid off next month.
Even the Times notes that GM destroyed the car, causing its quality and its sales to plummet:
Saab was always known for its innovative engineering. But analysts say that in recent years, with General Motors’s emphasis on volume rather than individuality, it has lost its edge.
“Under G.M.’s ownership, they denuded the intellectual content behind the brand,” said Peter Wells, who teaches at Cardiff Business School in Wales and specializes in the automotive industry. “Its products are not exciting enough, and Saab doesn’t have a strong brand identity anymore.”
What follows will be the horrible consequences of GM's management unblunted by Government action. This is disgraceful.