Saab, like fellow Swedish automaker Volvo, is now partially owned by the Chinese government, with its cash-strapped parent company National Electric Vehicle Sweden (NEVS) confirming this week it has formed an alliance with two state-owned Chinese entities. Importantly, the confirmation ends speculation that NEVS was about to form an alliance with either Indian automaker Mahindra & Mahindra or Chinese automaker Donfeng.
NEVS’s two new Chinese backers include the Tianjin Binhai Hi-tech industrial Development Area (THT) of the city of Tianjin, and the Beijing State Research Information Technology Co., Ltd. (SRIT) tech firm. Details on the composition of the alliance are yet to be announced but it's being reported that an initial payment of approximately $40 million dollars has been made as part of an eventual $200 million deal in which the new partners will secure a 30 percent stake in NEVS. It’s previously been reported that NEVS was looking to form a new subsidiary that would own the rights to Saab’s technology, including the still-in-development Phoenix platform, with half of the subsidiary then sold to any new partner(s).
What has been announced are plans for a new joint-venture factory in Tianjin that NEVS will use to build new electric cars. The cars will ride on a platform developed by NEVS, most likely the aforementioned Phoenix, and will initially be aimed at the Chinese market. It’s not clear yet if the cars will be badged as Saabs.
And with the alliance with SRIT, which is also linked with state-owned communications giant China Unicom, NEVS will be able to quickly catch up with rivals in the area of software services and connectivity, one of the most important trends in the auto industry going forward.
“NEVS’s focus is to produce high quality electric vehicles with China as its initial main market,” NEVS chief Mattias Bergman said in a statement. “The long-term cooperation with the development area THT in Tianjin and the IT pioneer SRIT will help us achieve our vision and our goal of a global strategic presence and is an important addition to the resources we have in Trollhättan.” Trollhättan is the Swedish city where Saab’s main factory lies. There's been no mention of if or when production of Saab cars will resume here.
In case you’ve lost track of Saab’s trials and tribulations in recent times, the automaker was sold by General Motors Company [NYSE:GM] to Dutch firm Spyker in 2010 after years of losses. Under Spyker’s watch, Saab went bankrupt within the space of two years. NEVS, a consortium of Chinese and Japanese interests, picked up the assets of bankrupt Saab in 2012. NEVS eventually restarted production of the 9-3 in 2013 but ran out of cash in 2014 after a previous deal with the Chinese city of Qingdao fell through, forcing it to seek bankruptcy protection. NEVS finally emerged from bankruptcy protection last month after a deal was reached with creditors, allowing it to reach this latest alliance with the Chinese partners.