Troubled Swedish carmaker Saab will recover from financial difficulties that have resulted in lengthy factory shutdowns, the head of its North American unit said on July 7. "I'm more convinced now than ever the brand will survive," said Tim Colbeck, president of Saab Cars North America.
"I think we're in a position where we can have strong cash flow and reach profitability pretty quickly," Colbeck said at Saab's suburban Detroit headquarters.
"Remember we have a very low break-even." Victor Mueller, the Dutch entrepreneur who acquired Saab from GM last year, has said Saab needs to only sell 80,000 units worldwide to break even.
Colbeck said Saab's U.S .sales have been hit by the troubles in Sweden which delayed deliveries of the 9-3 and 9-5 models. But he said sales are expected to pick up again soon now that dealers are taking delivery of the new Saab 9-4X, which is built at a General Motors plant.
Colbeck forecast that U.S. sales -- which were up 155% at 3,436 in the first six months of the year -- could easily jump to 30,000 units in the next couple years.
Saab was caught short in late March when suppliers halted delivery of components in a dispute over payment. The shutdown forced Muller to search for fresh sources of cash to keep the company afloat and to pay suppliers and workers. The Swedish government on Wednesday gave the green light to a 28-million-euro (US$40 million) deal for Saab to sell and lease back 50.1% of its Trollheattan plant. Saab welcomed the deal and said in a statement it planned to restart its production, which has been repeatedly stalled and last stopped on June 8, on August 9.
Saab was rescued at the last minute in 2010 when auto industry minnow Spyker bought the brand from General Motors for $400 million. In its 20 years as a GM brand, Saab never turned a profit.
The new owner had big ambitions for Saab but the carmaker has since then lurched from one cash crisis to another.
It announced earlier last month tie-ups with Chinese car distributor Pang Da and manufacturer Zhejiang Youngman Lotus Automobile which would see them take a majority stake in Saab.
Copyright Agence France-Presse, 2011
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