Automotive News Europe: Sell Saab (and Volvo)
Automotive News Europe editor, Arjen Bongard, has sounded off about the possible sales of Swedish carmakers Saab and Volvo. I don’t know where he hails from, but he almost sounds Swedish:
Rumors are flying this month that Ford Motor may sell Volvo and General Motors is considering dumping Saab.
That’s not necessarily a bad thing for the two Swedish premium marques. It could actually give the venerable brands a new lease on life.
This has been a long-time debate and with Automotive News weighing in, it seems it’s gathering some momentum. This is a pretty authoritative publication that’s highly respected in the industry and I don’t think they’d add their voice to the discussion in an editorial fashion without cause.
That cause is two-fold: First there’s the recent speculation about GM’s financial hardship and the fact that Saab contribute very little in sales terms to their bottom line. GM claim the customers Saab bring in are all plus-business. But Saab is all minus when it comes to GM’s bottom line.
Where you’d like the apportion the reasoning for that is up to you, but Arjan’s got his own ideas and I’d suggest they reflect the ideas of many at this site.
both Volvo and Saab have suffered from a lack of commitment by the parent companies and an absence of vision about the role and purpose of the two brands.
He’ll get no argument from me on that count.
I love the Saab 9-3 and I think the Swedes managed to make something great out what they’ve been given. But I also get the feeling that there’d be much more to it if they were given their head. Those Swedes have got a knack for making for much out of a little. They took a quaint Saab 99 combi coupe and it evolved into one of the most distinctive cars of the 20th century.
Secondly, there’s the cause of the brands’ integrity and the cars they make. Back to Arjan:
Both Volvo and Saab are names that any new entrant in the European market would love to own. And for a volume carmaker such as Renault, with its upmarket aspirations, the acquisition of Volvo — or Saab — could be a quick way to enter new premium segments.
The biggest problem for Volvo and Saab is the quality of their lineups today and the competitiveness of their new products tomorrow.
The owners have allowed the two brands to develop cars that are not competitive enough. A new owner could do better — a lot better.
Saab have a revolutionary new all wheel drive system. They have a new crossover vehicle in the wings, and they have a new 9-5 coming that is, by all accounts, quite stunning.
The 9-3, even with XWD, is still seen as underdone, however. The 9-4x will open new doors for Saab but it’s hardly groundbreaking. I can’t help but think that if you had access to a time machine, Bjorn Envall’s team would have made something extraordinary out of the 9-4x. Michael Mauer’s team would have just made the 9-3x and be done with it. We know very little about the Saab 9-5 that’s coming, other than that the people who have seen it say it’s fantastic. That’s encouraging but it’s not a day on a twisty mountain pass.
Arjan seems to understand what Saab need. With the exception of the pre-2000 Saab 9-5, all of Saab’s vehicles and proposed vehicles have basically been variations on themes existing elsewhere in GM’s portfolio. As good as Saab have made them, it’s a ways short of the distinct one-of-a-kind stuff they made their name with.
So. To the future?
In addition to Renault, Arjan also raises the possibility of a Chinese or Russian company taking over either Saab or Volvo. I’ll take the known quantity in Renault, thanks. They understand cars, including performance cars (Formula 1, anyone) and being French, they should understand passion and the demands of a passionate following.
Nobody really knows what GM will do with Saab. I’d bet on them keeping them and I hope they really do invest in them properly. I worry a lot about GM’s push with Cadillac in Saab’s sandbox, though. It makes me question GM’s sincerity with Saab. Rick Wagoner came out last week and said that no other brands are being considered for the chopping block, but if you think they haven’t spoken about it in the boardroom at some stage then I’ve got a house in Rosebery, here in Tasmania that I’d like to sell you….
It’s surprising to see Automotive News write like this and it makes me wonder if there’s more happening under the surface than what we know about already.
Time will tell.
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It is summer. It is slow on news. So Automotive News do what they do best: pick up on rumors and speculate about those.
“Rumors are flying this month that Ford Motor may sell Volvo and General Motors is considering dumping Saab.”
There are always rumors about anything. There are probably rumors that BMW will buy Honda. And the best about rumors is that you can just say that they are there, and start building your hen out of that feather. No need to substantiate, verify, clarify. You have a standpoint, but instead of having the courage saying “I think or believe this”, you refer to rumors and all of a sudden you doing us a great favor in telling us this “fact”. And frankly, how often do people go back and see what publications like Automotive News wrote three years ago to see if anything of it were even remotely true? No one. So as long as a rumor generate an interest from readers, it will always exist.
“The biggest problem for Volvo and Saab is the quality of their lineups today and the competitiveness of their new products tomorrow.”
Pure rocket science. Also, quality compared to what? And how can he already say that the products that will be released tomorrow will not be competitive? Is he clairvoyant? Typical general BS that journalists get away with because nobody will question what they actually say and mean, and if someone do they just say they are referring to sources they can’t reveal, that it’s an “editorial”, etc.
BMW are going to buy Honda!?!?!?
Seriously, though, I understand what you’re saying, but I really do think that GM are at least considering this behind closed doors. They’ve got a huge need for cash preservation. It’s not that they’d raise much by selling Saab, it’s the bleeding they could reduce with it not there.
It’s a remote chance, but it’s a chance. Or maybe it’s just me wishing……
Swade,
Didn’t you know? At least, I think saw it in my RSS late last night when I came home from a party and was drunk so it must be true…
Yes, I do think they consider a sale of Saab. Actually, they should have done that for the last 18 years or otherwise they are not doing what they should do. But, on the other hand… Why considering it now when they clearly are developing and testing new Saab models for the first time in six years? When they for the first time since I-don’t-know-when are planing to expand Saab to new segments and doing so with more that just badge-jobs? When they have taken billions after billions in losses for 18 years but now have a lean organization that is well integrated into GM Europe and could make money? When that GM Europe is almost that only thing giving GM money at the moment?
Yes, I think (hope!) that they discuss Saab every day at the mothership. But no, I don’t think they will sell it for at least four years. And if Saab has a modern model linup and are making money in 2012, why then sell it? GM is in the car building business. True, Chevrolet and Cadillac are probably closer to GMs heart than Saab, but it’s not like Ford were there are a brand with the same name and a board members who’s last name is Ford.
Yeah, BMW are buying Honda. I’ve got word from a guy who works at the Anaheim Krispy Kreme across the street from Honda HQ. He saw some management types talking to guys who showed up in a *BMW*. I rest my case.
Since we’re contemplating baseless rumors, Saab-BMW would make a great combo. BMW can focus on RWD performance while Saab can focus on FWD dynamics. Between the two you’ld have amazing engines, chassis, and design expertise.
Saab and Volvo should team up and make one big, independent, Swedish car company. Each should have their own distinctive product line with keeping the Volvo and Saab brands but share platforms, R&D and manufacturing. Just make sure that it is an equal merger so it won’t turn out like the Daimler-Chrysler debacle.
Let me add to the wild speculation:
Why doesn’t SAAB/Scania just slurp SAAB Automotive back into the original mothership? And REALLY be Born-AGAIN-From-Jets?
As I predicted a couple of months back, I think the new 9-5 will be GM’s bargaining chip to sell Saab.
It will try to broker a deal much like Ford did with the Jaguar XF, which should keep it in production at Rüsselsheim, probably for the life of the model. The form the next 9-3 takes, will most likely be up to the new owner which may or may not, delay its appearance.
As a guess, I would say that Renault would be more interested in Volvo than Saab as they have had some connection in the past. I think it’s more likely that Daimler or BMW will be the new parent of Saab, but the buyer may not be German. Anyway I’m guessing we’ll probably all know before the end of 2009.
David N.,
Unfortunately, Scania is basically owned by VW and therefore Audi is the brand that will benefit form Scania technologies in the future. Also, last week, Saab announced plans to sell Saab Space to a Swiss company…
I like Wulf’s idea. Let’s let the Swedish car companies work together as one and end the GM and Ford b.s.
I think the quality would go up. Reputation and Safety speaks for it self.
It is interesting to note that Valmet Automotive in Finland who formerly built Saab’s convertibles, the Viggen and other special models, have lost their contract to continue building the Porsche Boxster.
Starting 2012, the Boxter will be produced at Magna Steyr in Austria which currently produce the Saab convertible. I wonder if someday, Saab convertible production might return to Finland?
Saab and Volvo could also share dealerships, transportation, US and other countries headquarters and so on. Maybe something like the V.A.G. group. Make Volvo the every-(wo)man’s car (like VW) and make Saab the performance/luxury brand (like Audi).
Perhaps even take Koenigsegg into the mix and put the Aero-X into production… (like VAG and Lamborghini).
I dream a lot and really have too much spare time.
Wulf: It is rumoured that Investor AB when they owned part of both companies, considered combining Saab and Volvo in about 1997 as they weren’t totally happy with what GM had planned for Saab. I wonder how things would have turned out?
If Saab and Volvo were combined like VAG, I’m sure they’d argue as to which one was VW and which one was Audi. Koenigsegg would be good in their as well, but they’d probably need a cheaper brand too, like VAG has Seat and Skoda. Nice dream though!
I am sure there would be a lot of arguing between the two brands. Heck, Volvo can even have the upper hand as they are bigger and sell more cars anyways. But I much rather walk into a Volvo-Saab dealer than a Cadillac-Hummer-Saab place.
for sure the next 9-5 will be again the “inflexion point” in the future of the brand, as the 1997 9-5 that give to the company a breathe of air to still continue and saved the company, with the new 9-5 I think will happen the same. If the next 9-5 fails, it will be the end of Saab in the GM group.
From autonews.com
Despite differences, Saab and Volvo face similar uncertainty
GOTHENBURG — Less than 65km northeast of Volvo’s Torslanda factory is Trollhättan, the home of its Swedish rival Saab.
Volvo’s troubles are minor compared with those of Saab, which has seen global sales fall 18 percent to 55,000, according to figures from its parent, General Motors.
GM has struggled with Saab since it bought the company in 1990. Saab has been unprofitable for years.
The brand got a boost earlier this year from news that it would be allowed to build the new 9-3 lower-premium car. But the important 9-5 medium-premium model will be built by sister brand Opel in Germany, not Sweden, starting in 2012.
Like Volvo, Saab has recently been the subject of rumors that its American parent will sell the brand. Spokesman Eric Geers, denies that. “There are absolutely no plans to sell Saab,” he said.
Like Ford Motor, which owns Volvo, GM needs to focus on stemming heavy losses in its US home market. That could mean the sale of overseas operations.
Unlike Volvo, Saab relies heavily on GM to handle its research and development.
Saab does some development work at its plant in Trollhättan, but GM mostly uses the site for production.
GM’s intentions in Sweden
“I think the future will depend on how well Saab does when they start building cars in Germany,” said Svenake Berglie, head of the Scandinavian suppliers association.
A lot will also depend on whether GM manages to find the proper balance between Opel and Saab models.
The decision to build the 9-3 in Sweden has given local industry executives hope that Saab will continue to be an important Swedish nameplate.
Said Malin Noren, head of the Automotive Sweden lobbying group: “It feels like GM is talking honestly when it says it wants to grow Saab.”
Volvo/SAAB, Hhhmmmm……
When I see the launch of the new Vauxhall/Opel Insigna today in London, I think GM is trying to upgrade the image of Vauxhall/Opel ,and trying to put these brands on a most luxury segment than the previous Vectra . When the Vauxhall/Opel/Holden/Saturn Insigna with a large choice of diesel engine ,the advanced Haldex AWD system, and powerful petrol engine goes on sale , it’s will be to the detriment of the 9-3,this new Insigna look pretty cool, by this way I don’t really understand where is the place of Saab in the GM portfolio ,as they have also Cadillac for those who want more luxury again.
So, Saab will be perhaps in a nicest position in the hand of Renault for example ,in the Renault portfolio Saab will be THE luxury brand without any doubt ,and Renault had a great experience of motor sport and turbo charging unit ….why not.
A Swedish dream team Saab, Volvo, Koenigsegg, Scania…why not to but it’s probably just a dream .
If GM wants to sell SAAB they better hurry. Volvo is a much more desirable brand. They have a full range of vehicles, they have a well developed brand identity and I think that gives them a leg up on SAAB. As for Renault buying SAAB or Volvo. I just don’t see it. Renault is commited to selling Infiniti’s in Europe, why compete against yourself? PSA on the other hand has no options other than to move Citroen upmarket or buy a premium brand.
Peugeot and Citroen share platforms and technology and are basically in the same market segment. However, competitors might be pushing it a bit hard. Citroen has always had the quirky label stamped on them too and you can see from the likes of the new cross-over and C5 that they are making a conscious effort in making an affordable niche brand. If Volvo and Saab done the same then Let Volvo take the premium segment. Volvo sell far more cars and ultimately would generate more profit that premium cars generally do. It’s only been since the 9000 that people have considered Saab as a premium brand but in reality I wasn’t Saab’s intention to move into this segment. I believe it was more of the case that they ended up being pigeon-holed as premium because the quality was certainly not mainstream. I would not have a problem buying a Saab with the level of quality equal to say the Ford Mondeo. Ford Europe’s cars right now are very well designed and built. On the whole are a very good package. Very much entry-level premium but without the actual premium applied to the price. This is where Saab should be.
Saab and Volvo! no way, that won’t work.
saabers and volvoists cant stand each other. half of the buyers would deflect to another brand out of pure rage. it won’t work, it just won’t.
a wise man once said.
you ride in a volvo but you drive a saab.