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Saab Re-Starts Plant After Unpaid Suppliers Temporarily Halt Deliveries

Shutdown hints at other challenges facing Swedish maker.

by on Mar.30, 2011

Production of the Saab 9-5 was temporarily halted over unpaid parts bills.

Saab assembly operations in Trollhattan, Sweden got back to normal – more or less – this morning, following a day long shutdown triggered by suppliers who refused to deliver parts pending payment of outstanding bills.

Company officials insist they are working to “resolve these issues,” but there is no question the Swedish maker is struggling in its attempt to rebuild itself after nearly shutting down permanently last year.

Operations at the facility, which produces Saab’s flagship 9-5 sedan, ground to a halt, yesterday, when a number of suppliers refused to deliver more parts until they were paid.  It’s unclear precisely what arrangements were made to get those vendors to restock the plant and let it reopen this morning.

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But a statement from Saab says it “expects to resolve these issues in the short-term.”

The brief shutdown is the latest twist in an ongoing saga of a company that has long struggled for survival.  Going into its 2009 bankruptcy, former owner General Motors Corp. announced plans to sell or close Saab – while eventually also shutting down its Saturn, Hummer and Pontiac brands.  Initially, with no buyer coming through with the necessary deal, GM began shutting Saab down.

Eventually, a white knight emerged in the form of Dutch-based Spyker, then the producer of a low-volume line of supercars.  By the time the acquisition was completed, Saab needed nearly two months to get its Trollhattan plant back into production.

Since then, the carmaker has struggled to ramp up production and marketing operations, rebuild its dealer network and get the message out to potential buyers that it is still in business.

But its finances are, at best, precarious.  Last month, the Spyker operation was sold off to Russian businessman Vladimir Antonov.  Weeks later, the maker announced a $200 million loss – though Saab Chairman Victor Muller, the Dutch entrepreneur who negotiated the purchase, insisted the company should be back in the black by 2010.  (For more on that story, Click Here.)

The Saab story took yet another turn, last week, when the 60-year-old Jan-Aake Jonsson, its CEO, announced plans to retire.  Muller plans to temporarily take on his duties while the search gets underway for a permanent replacement.  

Sales have been ramping up slowly, though Muller’s former partner, Russian businessman Antonov, said he does not believe Saab will make its sales target this year.  Muller has insisted the Swedish company is on target.  He claims Saab can turn a profit on relatively low volumes – as little as 80,000 vehicles annually, well under the company’s former sales numbers when owned by GM.

Along with the new 9-5, Saab has just begun production of the new 9-4X, its first crossover.  It is developing an updated version of the aging 9-3, which will be loosely based on the Phoenix concept car revealed a month ago at the Geneva Motor Show.  (Click Here for that story.)

That is, of course, if it can cover its bills and maintain the flow of parts and components.

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