Update: GM Threatens To Cut Ties, Halt 9-4X Production If Saab Is Sold To The Chinese

Saab apparently isn’t quite out of the woods yet, as former owner General Motors is threatening to block the Swedish brand’s sale to Chinese automakers Pang Da and Youngman Lotus.

According to the Financial Times, GM is concerned over its technology, present in several Saab models, transferring to rival companies in China, the American automaker’s current largest market. GM has veto power over the sale, and could block the deal recently approved by a Swedish court.

General Motors said Friday that it “would not be able to support a change in the ownership of Saab which could negatively impact GM’s existing relationships in China or otherwise adversely affect GM’s interests worldwide.”

Update: An Automotive News story from Monday says GM's stance is now a little stronger. A spokesman says the automaker is "open to the continued supply of powertrains and other components" to Saab, it won't continue to license technology or manufacture 9-4X vehicles for the company following a Chinese takeover. GM believes doing so "would not be in the best interests of GM shareholders."

The 100-million-euro deal to purchase Saab is subject to approvals by several parties, including GM, and expires November 15. That deal has been months in the making, and could be undone if the two Chinese automakers and Saab parent company Swedish Automobile, formerly Spyker Cars, can’t get the go-ahead from GM.

In 2009, GM’s fears over losing ownership of its intellectual property prevented Chinese automaker Beijing Auto from taking a stake in GM’s European Opel brand. Those fears are also present in GM’s consideration of blocking the sale of Saab, which would be in the hands of two Chinese companies largely unknown in the auto industry if purchased. Models like Saab’s flagship 9-5 sedan and 9-4x crossover are based on GM technology, and the American automaker has retained the right to revoke the licenses for use of those technologies. Such a move could severely diminish Saab’s value, or could make the sale altogether unviable.

Ford Motor Company faced a similar dilemma in 2009, when it sold Volvo to China’s Geely Automobile. To protect its technology, Ford only transferred control of intellectual property developed exclusively by Volvo. Volvo can still use Ford technology, but new parent company Geely has no ownership rights. Similar safeguards could be employed by GM for its technologies, though such measures would have to be put in place before the deal’s expiration on November 15.

Source: Financial Times, Automotive News (Subscription required)

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