Founded in 1945, went defunct in 2016, this is the true story of the rise and fall of Saab Automobile AB.
The Swedes established Saab, also known as Svenska Aeroplan AB in 1937. Originally, the Stockholm-based corporation, which is a Swedish aerospace and defense company, had nothing to do with posh vehicles. In fact, the Swedes created the company because of the lack of quality military aircraft available to the local government. After manufacturing aircraft during World War II, the company required additional revenue streams after the war, so it breached out and diversified. Accordingly, in 1947, the Swedish company began producing automobiles under the Saab Automobile subsidiary in Trollhättan. The first production car was the Saab 92, which was based on the prototype of the Ursaab and stood out thanks to its aerodynamics. The Saab 92 had a drag coefficient of 0.30.
In the 1950s, the Swedish company also began manufacturing computers, and in the 1960s it became an important player in the aircraft computer business. Later in the 1970s, Saab AB merged with Scania- Vabis and became known as Saab- Scania AB. All of these alliances had a significant impact on Saab, but the one with General Motors stands out as having significantly altered the company's direction.
When GM bought a 50 percent stake in Saab in 1990, it doomed the company for eternity. The merger, which at first glance appeared to be a match made in corporate heaven, gave the Swedish company access to American expertise, financial support, and its distribution channels, while it offered GM a strong footprint in Europe and an entrance in the European luxury market. However, the partnership was a failure that would ultimately kill the Swedish brand. So, here’s everything that went wrong in Saab.
The alliance between Saab and GM and the ensuing catastrophe are best described by Motortrend as “negligent homicide.”
“GM's initial 50 percent investment in 1989 saw the business behemoth make a crucial first step toward Saab's demise when it made it a Soviet-style client state,” says Motortrend.
Saab was an automaker known for beautifully designed cars that catered primarily to niche consumers. And the Swedish automaker was a business that placed safety and design before profit in order to uphold its own beliefs. The American giant, on the other hand, was all about profits, revenues, and large sales figures. GM was in the business of manufacturing vehicles with mass market appeal not safe, elegant cars suited only for a certain class of buyers, so when the companies entered a joint venture, Saab’s direction changed. This became even more evident after 2000, when GM took full ownership of the business, transforming it into a subsidiary.
“Typical of Old GM, the company pressured Saab to become another brand of badge-engineered appliance work, much like what plagued Oldsmobile, Pontiac and Buick for a greater part of the 1990s and 2000s,” said GM Authority. “GM envisioned Saab to become a rebadged Opel, something it would fight to the bitter end.”
Unfortunately, Saab didn’t win the battle; thus, the Swedish company had to make compromises and release vehicles that didn’t have the same aesthetic prowess as the Saab 96, the Saab 99, and the Saab 900, which even today retains its cult following.
During the GM years, Saab released some of its less stellar vehicles, such as the new 900, launched in 1994 that shared the platform with Opel Vectra, the Saab 9-2X, which was based on the Subaru Impreza, and the Saab 9-7X that was based on the Chevy TrailBlazer. The automaker designed the Saab 9-2X and Saab 9-7X having the American consumers in mind, however; they failed to meet GM’s expectations in terms of market performance, furthering Saab’s decline into obscurity. At that moment in time, Saab’s downfall was imminent because even European consumers had lost interest in the Swedish company.
Long gone were the days when Saab was almost synonymous with intelligent performance and safety. After ruining the iconic Swedish company, GM sold it to supercar maker Spyker in 2010. Before that, GM engaged in talks with Koenigsegg, but the deal didn’t go through. Unfortunately, the Spyker episode didn’t last and soon after acquiring the Swedish company, news broke that money was running tight and suppliers refused deliveries to Saab's factory in Trolflhättan until the automaker didn’t pay them in full. After trying to secure financing from Chinese investors but being blocked by GM, in December 2011, Saab filed for bankruptcy.
After that, GM vetoed Spyker's attempts to engage into agreements with Zhejiang Youngman Lotus Automobile Co. and Pang Da Automobile Trade Co. The situation became so heated that Spyker sued GM, alleging $3 billion in damages as a result of GM's actions, including their decision to halt the transactions with the Chinese investors. Still, in June 2012, a Chinese consortium called National Electric Vehicle Sweden (NEVS) bought Saab to “create a pure EV for the Chinese market based on the Saab 9-3”, according to Auto Express. Ultimately, even NEVS filled for bankruptcy and Saab canceled the licensing agreement that allowed the Chinese company to use the Saab name.
Adina Achim is a journalist with vast knowledge and experience in the luxury industry. She is passionate about luxury car brands, technological trends in the automotive industry, and exotic cars.
