Saab Lineup to Grow Under Spyker Ownership

Victor Muller, Spyker Cars N.V. founder and Saab Automobile AB chairman, says his plans are to return Saab to profitability by 2012. The model lineup will grow along with the company’s U.S. headquarters in Royal Oak, Michigan. Spyker bought Saab in February of this year from General Motors Company for $400 million as GM was planning a wind down of the brand after other deals to sell the money-losing brand fell through.

The deal with Spyker went through for deferred shares plus $74 million in cash. Muller was able to raise capital of nearly $1 billion including a loan for $550 million. In a recent interview Muller said, “It was wonderful to save the company. Now we need to make it profitable.”

Muller also commented on the herculean work to be done. Saab is running again after basically halting all shipments of cars to U.S. dealers in February, 2009, when shutdown seemed imminent. However, Muller says, “to fill the pipeline will take months.”

In 2008, Saab produced 98,000 cars, but the number dropped drastically to 21,000 in 2009. This year the goal is to build 40,000 units and reach annual production of 125,000 vehicles by 2012. Muller says jobs will be restored, models will be added, and the brand will be made more upscale. The company’s current staff of 45 will grow to 80 within the next few years in order to manage sales, service, finance and administration.

Muller plans a hands-on approach with frequent visits to the company’s U.S. headquarters in Royal Oak. He also plans to devote around 90% of his time to Saab and about 10% to Spyker, where 85 employees produce 50 high end sports cars per year.

In Europe, Saab’s workforce will grow from 300 to 3,700 by the end of this year, says Muller.

David Cole, chairman of Ann Arbor’s Center for Automotive Research says, “The business model looks good.” Current models include the 9-3 sedan, which will be redesigned this year, the 9-3 wagon and convertible and the 12-year-old 9-5 sedan. A completely new 9-3 is expected in two years using the new Phoenix base rather than the current GM underpinnings. The Saab-engineered Phoenix base will be used for other future Saabs.

Saab is years away from mass-producing electric vehicles. However, 100 electric 9-3s will be put on the road as part of a partnership with Boston Power, a Massachusetts lithium-ion battery maker.

A redesigned 9-5 model will hit showroom floors this week. Saab holds the license to use GM engineering for the 9-5 sedan through 2024, but the sedan could also shift over to the Phoenix platform in about 6 years, Muller said. The wagon version of the 9-5 will come next July.

Muller expects a huge rise in volume when a subcompact 9-2 is introduced in 2013 or 2014, possibly raising sales up to 150,000 per year. Speaking of the premium compact from the 1950s, Muller said, “That will be my finest hour if we bring back the Saab 9-2.” Speculation is that Saab will be using a European partner to produce the car but Muller would not confirm rumors that the partner will be BMW AG.

Anthony Pratt of PriceWaterhouseCoopers said, “If anyone can build a business model with fewer than 100,000 vehicles a year, it’s Spyker.” But he warned that the luxury market will be a challenge for the company.

Muller said, “We just need customers. Put a Saab on your bucket list. You won’t be disappointed.”

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