It might seem like a comedy routine if it weren’t so deadly serious; the company that bought filed Swedish automaker Saab out of bankruptcy itself averted its own financial collapse this past week and is now frantically seeking a new partner to keep the operation going.
A Chinese-controlled coalition, National Electric Vehicle Sweden hasn’t produced a car at Saab’s Trollhattan plant since May and was being threatened by an unpaid supplier ready to force it into bankruptcy – echoing what happened to the Dutch firm that previously tried to rescue Saab.
“The company does not have enough liquid cash today to pay all outstanding debt, but NEVS’ assets are larger than its debt,” the new Saab owner confirmed in a statement. “NEVS cannot say exactly when, but NEVS’ suppliers will get paid.”
Meanwhile, reports out of Europe indicate that NEVS is looking for a new partner to help it raise the cash needed to restart its assembly lines.
That was the same “Hail Mary” maneuver for Swedish Cars, the company that purchased Saab from General Motors in early 2010, only to run out of capital, forcing it to halt production in barely a year. Former CEO Victor Muller desperately sought out new investors and appeared close when he lined up several potential Chinese partners. But GM took steps to block those deals.
Saab’s workers and suppliers eventually forced the company into liquidation, but NEVS bought its key assets in 2012 and restarted production late in 2013. The new owners planned to start out assembling the old Saab 9-3 sedan, but the longer-term goal was to launch an all-new model based on the Swedish maker’s well-reviewed Phoenix concept vehicle.
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NEVS intended to target the Chinese market, initially, and was planning to turn the Phoenix into a battery-powered vehicle – taking advantage of China’s growing support for battery power as a solution to its endemic smog problems.
But NEVS was able to produce only a handful of the old 9-3 models a day before running out of cash and idling the Trollhattan plant.
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Earlier this month, Labo Test, one of its suppliers, threatened to ask the Swedish courts to declare the new Saab once again bankrupt. That petition has been withdrawn, according to NEVS, though it has not said whether that required it to pay the 150,000 Swedish kronors, or $21,800 it owed the firm.
It has significant additional debts which the Wall Street Journal last week reported total about 3.6 million kronor, or $4.8 million.
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NEVS is controlled by Nation Modern Energy Holdings Ltd., itself run by Chinese-Swedish investor Kai Johan Jiang.
Saab was founded in 1945 by a group of aerospace engineers and built a reputation for producing quirky, if technically intriguing vehicles. Almost constantly in financial trouble, it was taken over by GM in 1989. But Saab was one of four brands – along with Saturn, Hummer and Pontiac – that the U.S. maker planned to abandon following its 2009 bankruptcy.