General Motors, its former owner, has thrown a monkey wrench into the gears that had been set in motion for Swedish automaker Saab to be sold outright to two Chinese companies.
General Motors has veto power because it still holds preferred shares in Saab and supplies Saab with important automotive components. The Saab 9-4X is based on GM’s Cadillac SRX crossover vehicle and is built in a GM plant in Mexico.
Jim Cain, GM manager of financial relations, said Monday that, “Although General Motors is open to the continued supply of powertrains and other components to Saab under appropriate terms and conditions, GM will not agree to the continuation of the existing technology licenses or the continued supply of 9-4X vehicles to Saab following the proposed change in ownership as it would not be in the best interests of GM shareholders.”
Saab announced in late October that it had agreed to sell the company to Pang Da, China’s largest automotive retailer, and Youngman, a Chinese auto manufacturer, for $141.6 million. The price is a fraction of the $352 million the two companies had offered previously for a 53-percent share in Saab.
General Motors first expressed its opposition to the sale late last week, noting that it would be hard to approve a sale that could hurt GM’s competitive position in China.
In its own statement Monday, the trouble automaker said Saab officials “have taken notice” of General Motors position and will discuss the situation with the two Chinese companies to see if an agreement suitable to all parties can be worked out.
Auto industry observers believe the latest roadblock further diminishes Saab’s chances for survival.