June 23rd, 2011
01:29 PM GMT
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On a recent visit to a London showroom my mother – a Saab driver since the mid-90s – traded in her SE900 Turbo for a new Mercedes CLK 250.

At first glance the two cars seemed to offer the same attributes: Both were black, both convertible, with leather seats and walnut dash, and both appealed to the luxury market.

Had her car not been a bit on the ‘mature’ side, half of me would have wondered why she was keen to swap.

But a turn of the ignition key was all that was needed to understand how Saab had veered so spectacularly off track, while its rivals remained in pole position.

My mother confesses that her Saab "looked like an exciting car" but it didn’t feel sporty at all.

"It felt more like a tank," she said.

The false promises of my mother’s Saab became something of a family joke, leading my sister and I to dub her trusty 4-wheeler the "Banana boat."

I must confess that with or without the roof down its visibility was incredibly poor and though comfortable when cruising at the speed limit it took the car ages to actually reach it.

As a result, when we walked past a row of competitively priced Saabs on display I couldn’t even get my mother to stop and look at them.

"No, I don’t think I’ll have one of those again even if they are cheap," I heard her mutter. 

Three years after the near death and sudden recovery of the U.S. automotive industry Saab is still in intensive care, selling only 30,000 vehicles last year.

Today it seems Saab took a turn for the worse: Admitting it didn’t have the funds to pay its staff.

Some analysts have speculated this could be the final hour for a firm that has traded hands twice since the late 80s, as each time its owners realised the business needed more money spent on it than originally thought.

That’s a feeling many a Saab owner will be familiar with as they try and get their Saab past its annual check-up at the garage.

If this is indeed the end of the road for Saab, it will undoubtedly mean bigger maintenance bills for the owners of its cars.

This is because spare parts will become harder to get hold of and more expensive. The honouring of warranties is also a point that is unclear. 

Yet I am unconvinced as to whether we really have heard the death knell for a maker of cars that were once seen as the acme of both style and substance. 

Saabs from the 60s are still collectable classic cars.

There are some encouraging precedents in the automotive industry too – albeit thanks to a hefty amount of government money.

General Motors, which owned Saab between 1989 and 2010, rode back to rude health recently after driving investors hopping mad two years ago when it said it didn’t have the cash to pay its bills.

Saab’s immediate problem, just like GM two years ago, is a cash crunch.

 For the moment it has two options:

1)   It can realise the value of its sizeable real estate portfolio by selling off its factories and leasing the sites back. That would buy Saab some time though it wouldn’t address its underlying issues with car design and branding.

2)   The company also confirmed last month that it was in talks with two Chinese automotive companies ready to buy more than half of the firm in exchange for $350 million. This deal would provide the investment required to spruce up Saab’s image though its viability hinges on gaining EU and Chinese regulatory approval.

Saab’s current Dutch owners bought the business with an already flat battery 18 months ago presumably because it was cheap.

Mind you, you don’t need to be a financial wizard to spot a false economy when it is staring you in the rear view mirror, as thankfully my wily mum well knows.

soundoff (12 Responses)
  1. Rene

    These Dutch cheese farmers should never have been allowed to buy this company in the first place.
    I hope it will drag them down like a big fat boat anker.
    Just let it go bust and buy the best pieces at bottom price.

    June 23, 2011 at 2:32 pm |
  2. henry

    sorry but it sounds to me like you are comparing you mom´s old saab (the 900 went out of production in 98) with a brand new mercedes? not really a fair comparison is it?

    June 23, 2011 at 7:06 pm |
  3. max

    This article is a JOKE it is full of inaccuracies. Saab would be thruilled with 300,000 sales last year. I'm betting this writer's mother doesn't even own one!

    June 23, 2011 at 8:29 pm |
  4. max

    In fact Saab has never sold more than 130,000 units in one year in it's 60 year history. Her mother's mid 1990's Saab was the most heavily diluted GM vehicle in Saab history. How is it that the car has poor visibilty with the roof down??? It also has the LARGEST rear windows (with the roof up) of all European convertibles. I know these facts because I own one. CNN should pull this story down it is total garbage

    June 23, 2011 at 8:37 pm |
  5. rkalem

    What a piece of junk!

    June 23, 2011 at 10:29 pm |

    Sweden's "SAAB AUTO MOTIVE FACTORY" Economic Problems can be solved by four simple & fast actions.
    (1) Reduce staff by 60%
    (2) Employing youth to undergo & advance Technical Research to produce mass produced cars suitable for 22nd Century.
    (3) Shifting spare parts plant from Sweden to a country like India's rural area to cut costs.
    (4) Sell the whole company "SHORT" to ACS GROUP LTD.

    June 24, 2011 at 1:59 am |

    Political "CORRUPTION" & abuse of "Power & Mismanagent" by Fraud by top executives in this world responsible for the "disgraceful state of world affairs." "God Is Greater than all the Super Powers of Earth."

    June 24, 2011 at 2:05 am |
  8. tecdemond

    @Max, read the article again, it says 30,000, not 300,000

    June 24, 2011 at 5:51 pm |
  9. Anonymous?

    I'm not even logged in to this site yet at the bottom of the page on my screen a box inviting me to post a comment shows my name and email address – to me this raises some serious privacy issues – are CNN following my every click and gathering information through my IP address?? Very disturbing!

    June 25, 2011 at 3:31 am |
  10. ali

    @anonymous? : its probably your own browser doing an autofill or something. check it out and clear cache/cookies. my cnn website doesn't fill the fields you mentioned in for me.

    June 26, 2011 at 2:33 pm |
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