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Saab ‘Phoenix’ 9-3 set to rise in China

Saab future: Next year's 9-3 will feature elements of the platform and design of the Phoenix concept car (left).

New Saab Chinese alliance to kick start production with next-gen 9-3 in 2013

5 May 2011

SAAB’S next-generation 9-3 is set to become the Swedish car-maker’s first model to be built in China by the company’s planned joint-venture with new part-owner Hawtai Motor Group from 2013, about a year after the European debut of the all-new Phoenix platform-based 9-3.

The Chinese version, to be sold under Saab badges by Hawtai, is likely to be followed into production by the proposed baby of the range, the 9-2, which Saab wants to develop on a separate new platform shared with another car-maker.

However, the current Saab 9-5 flagship and Australia’s upcoming 9-4X SUV are unlikely to roll down Chinese production lines any time soon, as former Saab owner General Motors owns the intellectual property rights to the platforms under both vehicles.

None of the Chinese-made Saab vehicles are destined for Australia, with all local stock continuing to come from Europe or, in the case of the 9-4X due to arrive here by December or January, from GM’s Mexico plant.

Beijing-based Hawtai, a small privately owned car, SUV and bus manufacturer with a big investment in diesel engine and transmission manufacturing, has committed a total of €150 million ($A207m) to the deal that is set to steady the shaky Swedish company.

Saab Cars Australia managing director Stephen Nicholls told GoAuto that Saab’s strategic alliance with Hawtai would be a help to his company, which took over the Saab distribution franchise from Holden’s GM Premium Brands in January.

“There are a number of people who have held off making the final step (to buy a Saab), based on what finally happens with the corporation as a whole, and what we are seeing now is quite a positive response to this,” he said.

38 center imageFrom top: Saab Cars Australia managing director Stephen Nicholls, Saab 9-5, Saab 9-4X.

Mr Nicholls, whose local operation is wholly owned by Saab parent company Spyker Cars NV, said Saab staff had been delighted with the Hawtai agreement, in which the Chinese company plans to buy up to 29.9 per cent of Spyker and lend Saab €30 million ($A40.7m) as a convertible loan in return for Saab distribution and manufacturing rights in China.

He said the loan from Hawtai and another of similar size from finance company Gemini should pave the way for a resumption of production at Saab’s Trollhattan plant in Sweden as early as next week and, longer term – as long as the new ownership structure was approved – a secure future for the brand.

“We are really very, very pleased with the outcome,” he said. “If people sign all the things that they are supposed to sign and approve everything – and we believe that is going to happen – then we have a very stable position and good future prospects,” he said.

“Whereas we have always been believers in the brand, we have been tested over the last few weeks, so I think so it is looking very positive indeed.”

The Hawtai deal still has to be approved by the Chinese and Swedish governments and the European Investment Bank (EIB) – a process that Mr Nicholls said would likely “take weeks, not days”.

Mr Nicholls said Saab chairman Victor Muller – who is also CEO of Spyker – had expressed “a fair degree of frustration” at the delays in processing Saab paperwork to date – delays that had resulted in a shortfall of cash to pay parts suppliers, forcing the temporary closure of the Saab factory.

He said that despite this, the messages coming from headquarters about the road ahead had continued to be positive as Mr Muller and his team worked in the background on the new ownership and financial arrangements that could ultimately involve former major shareholder of Spyker, Vladimir Antonov.

Mr Nicholls said the ownership share arrangements still had to be worked through, but all the major stakeholders – including Hawtai and Mr Muller – had “a gentlemen’s agreement” not to exceed 30 per cent ownership as, under Dutch law, they would have to bid for the entire company.

“Depending on how it all works out, it could be like a 30-30-30 ownership with the various parties, and something like 10 per cent in public shares,” he said.

“It is one of those things where we will just have to see where the bouncing ball ends. I think it is a bit fluid, and but I don’t think any individual party is going to go above that 29.9 per cent.

“What Victor Muller said yesterday was that it is a shame we can’t have 150 per cent of the company because everyone wants more than they can really have.”

Mr Nicholls said Mr Muller had strongly rejected a suggestion that Saab was exporting jobs from Sweden to China via the Hawtai alliance.

“He said the Chinese factory will be building Saabs for the Chinese market only,” he said.

“It only makes sense to do that with a new product, and the next new product we have is the next-generation 9-3, which will be starting production in September or October next year, and that’s the car that would then be built in China.

“But the local (Chinese) homologation and rules process takes quite a bit of time there, so it is probably not going to start in 2012, and so it would be 2013 before it goes on sale.”

Mr Nicholls said the cars made and sold in China would be Saab products, with Saab badges.

“Hawtai is only a shareholder or a partner in that sense,” he said. “They are not the Saab brand, so it is still a Saab product produced in a Saab factory.”

Mr Nicholls cast doubt on the chances of Chinese production of the 9-5 and 9-4X, at least until next-generation vehicles move off GM bases and on to Saab’s Phoenix platform, which was shown beneath a sleek new concept of the same name at Geneva in March.

“I think if we are going to look at producing a current model like the 9-5 or indeed the 9-4X in China, we would have to have some pretty serious discussions with GM, and frankly I think it is unlikely that we would be able to make that work,” he said.

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