No sale: GM's Saab deal falls apart after Swedish buyer pulls out
GM had hoped to seal the deal on the sale of Saab to a consortium led by Swedish luxury car builder Koenigsegg Group at the end of next month. But on Tuesday, Koenigsegg suddenly pulled out after it was unable to secure financing in time to close the deal.
"Time always played a critical factor in our strategy for reviving the company," founder Christian von Koenigsegg said in a statement. "Unfortunately, delays in closing this acquisition have resulted in risks and uncertainties that prevent us from successfully implementing the new Saab Automobile business plan."
GM expressed disappointment. In a written statement, GM Chief Executive Fritz Henderson said that given the sudden news, "We will take the next several days to assess the situation and will advise on the next steps next week."
In Three Swings at Brand Sales, GM Strikes Out
The deal's dissolution is the third such sale to fall through in as many months. In September, a plan to sell GM's Saturn brand to Penske Automotive Group (PAG) fell apart when company CEO Roger Penske was unable to find a manufacturer to supply Saturn with new cars after GM stopped supplying existing models within a few years. GM is currently in the process of winding down the Saturn brand.
Earlier this month, GM pulled out of deal to sell its Opel division, based in Germany, to Canadian parts maker Magna International (MGA), a pact that had the blessing of the German government. German Chancellor Angela Merkel fought to arrange Opel's sale to Magna and offered billions of euros in state aid in return for promises to protect German factories. GM is now scrambling to develop a restructuring plan for Opel and brand-mate Vauxhall, according to Dow Jones Newswires.
The fate of Saab is uncertain, although it is believed the brand will be wound down, along with Saturn and Pontiac. Saab owners would continue to see their cars covered by GM warranties and be assigned new dealerships for service.
Saab's presence in the U.S. market is tiny; it makes up less than 0.5% of total new-car sales here. The brand's uncertain future has taken a greater toll on U.S. sales, pushing them down to fewer than 7,500 during the first 10 months of the year, a 61% drop compared to a year ago, CNNMoney.com reported.
The sale of GM's Hummer brand still hangs in the balance. A deal was reached in October to sell the maker of monster SUVs to Chinese heavy-equipment maker Sichuan Tengzhong Heavy Industrial Machinery Co.
Given GM's track record for sealing deals, however, it wouldn't be surprising to see the 7-year-old nameplate wind up on the scrapheap of history with brands such as Edsel and DeLorean.