Is Saab Bound To Be Scrapped?
November 25, 2009 12:41 PM
The Wall Street Journal reports that Saab, one of the subsidiaries of General Motors Corp seems to be headed for the junkyard even as the plan to sell it to a Swedish maker of exotic cars, Koenigsegg Group AB, failed.
The deal which was based on financial backing from the Swedish government fell through as it was too costly for a boutique car maker. As of now, the only hope for the 4,000 workers of Saab seems to be on another buyer surfacing and it is said that it is premature to speculate on the Company’s ultimate fate. However, industry observers say that getting another buyer in the midst of a recession seems very unlikely. The sudden collapse of the Saab deal implies that GM and its newly formed board face another difficult decision. Saab is projected to sell less than 50,000 automobiles this year and comprises less than 1% of GM’s total sales. Revamping its old vehicle lineup and machinery could cost billions of dollars.
