NEWS: The Saab Story Continues: Wants to Pay Suppliers on Layaway

By Donny Nordlicht - June 21, 2011
2011 Saab 9 5 Assembly Front View
Saab has been having a rough year. After separating from General Motors last year, the Swedish automaker has had a roller coaster ride of deals falling through at the 11th hour, and cash shortages causing numerous production shutdowns.
Earlier this week, Saab announced that its Trollhattan, Sweden plant would remain closed for another two weeks, after already being closed for most of April and May. The production stoppages have been due to the company’s inability to pay its suppliers for parts.
Now, in a bold move, Saab has sent letters out to the suppliers, taking a page from Wal-Mart shoppers: it would like to buy parts on layaway. The deal Saab has offered is to pay its suppliers 10 percent of its debts up front to receive the necessary parts to restart production; it will then pay the outstanding costs this fall, once it has cash on hand.
CEO Victor Mueller was quoted in the letter sent to suppliers saying that Saab needs “full commitment to this to move forward,” according to Reuters. The letter also stated that the suppliers had until today to respond to the automaker’s offer.
In the past few months, Saab have received a number of rescue packages from Chinese companies Pang Da and Youngman Lotus Automobile to help stem the company’s hemorrhaging of cash, and previous-owner General Motors has agreed to continue building the new 9-4x crossover for the ailing Swedish brand.
Saab hopes to reopen its plant at the start of next month.
Source: Reuters 1, 2
2011 Saab 9 5 Assembly Front View

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