Welcome to our imaginary world of The Car Boss. Continuing where we left off (Car Boss – the tension mounts) thing are starting to come together…
After months of speculation and various interest from several automotive parties, Paragon Automotive have signed a deal to purchase SAAB Automobile AB, allowing production to re-start Trollhatten.
Under the final contract, Paragon Automotive is believed to have paid over 200-million Euros for SAAB and will be a 40% shareholder in the Swedish manufacturer. General Motors will retain a 33% share, whilst CCN, a Chinese investment company, will be a 27% shareholder. It’s not a surprise to still see General Motors in the frame, as they have significant technology interests which can be used to develop and improve the current and new-model lineup, as well as reduce initial investment for research and development.
Having visited Trollhatten in early April, the board of directors from Paragon Automotive, General Motors and CCN, agreed the final conditions to revive SAAB. On the announcement, Paragon Automotive CEO, Nick Brown, said “there are still outstanding finances that need to be resolved from this buyout plan, but most importantly, we can now move forward and re-start production. The town of Trollhatten will once again be a buzzing community and the centre for trade and business that it once was”.
All three business partners are to launch, SAAB PGC, a new company that will handle all business matters in the Swedish manufacturer. Under initial proposals, SAAB PGC, will invest 20m Euro’s to re-tool the main factory production facility at Trollhatten as well as recruit previous SAAB employees. A new SAAB management team will also be announced shortly. There will also be talks with SAAB North America in early July to discuss the options of a new import contract as well confirming a new dealer network.
SAAB PGC has set a date of August 1st 2012, to re-start production. In the meantime a global conference meeting will take place in June inviting all current SAAB affiliates to discuss SAAB’s business plans set out by the board of directors. A spokesman for SAAB PGC said, “We have set our goals in place and we want to make sure we have everyone on board”.
Initial plans already indicate that SAAB UK could be expanded to handle all business matters for the UK and European markets, whilst a new division will be established in China and India. “These are two new markets which have great potential for SAAB, and we want to capitalize on these as soon as possible”, continued a company spokesperson.
Having the experience of General Motors and their automotive technology to hand, SAAB PGC is now putting the plans in place for a new model lineup.
Under the proposals, a new sub-compact model is already underway and is believed to be called the 9-2. Meanwhile, the axed 9-4X compact SUV, is being put through a development program and will be re-launched with fresh engines, including a diesel for Europe, around September 2012.
The 9-3 and 9-5 models will also receive a facelift and new engines by the end of the year.
SAAB PGC is also currently recruiting a new in-house design team to come up with a replacement for the ageing 9-3 along with design studies for future models.
Now that SAAB has been rescued, can the three parties work together to make a good business model? With General Motors still having a significant share hold in the business, it’s a very difficult to call.
We’ll wait and see what happens next.