killed Saab Automobile? - Business School - University of Edinburgh

Saab was refusing to bow to GM's interference. The result was a company that failed to grow out of its
niche, a niche that was itself under attack from strong competitors, particularly Audi. Following the demerger
from GM, Saab was no longer viable as an independent firm, and in our view the frequently
called-for government intervention would not have prevented the failure, but may have delayed it at
best.
We remain very sceptical about any significant complementarity there could have been with the
Chinese partners that were proposed by SWAN. Clearly the Chinese partners would have brought cash
in the short-term, and possibly could have provided a sales channel into China. Beyond that, the tie-up
with Youngman (which produces its own passenger cars for the entry-level segment, co-developed with
Lotus Engineering in the UK) offered no technological benefit or scale economies. Furthermore, if
Saabs were eventually to be manufactured in China, what interest any Chinese firm would have in
keeping a car factory in Sweden? From the point of view of the Chinese firms, the tie-up would have
made more sense: new to the automotive industry, there is a great hunger for technology and brand.
Saab could have offered both, at a discount price, had GM allowed it to.
35