Struggling Swedish automaker Saab officially filed for bankruptcy protection in Sweden, a move that the company says will allow it to reorganize without having to worry about its creditors.
Saab hasn’t built cars in several months as it has sought funding to pay both its workers and its suppliers. The filing was hardly a surprise since the company’s unions have stressed that they would push the automaker into bankruptcy unless wages were paid.
“We have concluded that a voluntary reorganization process will provide us with the necessary time, protection and stabilization of the business, allowing salary payments to be made, short-term funding to be obtained and an orderly restart of production to be prepared,” Saab chief Victor Muller said in a statement.
The automaker says that the filing will give it time to wrap up deals with Chinese firms Pang Da and Youngman, but Chinese authorities have yet to approve either tie-up. Saab says it has orders for about 11,000 cars from Chinese buyers but that it lacks the funding to pay for either.
Within three weeks, Saab says it will present its full reorganization plan to creditors. The company hopes to pay August salaries shortly thereafter.
Pre-packaged bankruptcy deals saved Chrysler and General Motors in 2009, but Saab’s situation is unique in that the automaker operates in a more tightly-controlled European market and that its overall size is much smaller.
Saab’s unions have remained optimistic about the filing.
“If Saab pays its debts, or at least some of them, we will help get production up and running again,” said Lars Holmqvist, CEO of the European Association of Automotive Suppliers.
Saab has faced various uncertainties since former owner GM attempted to close the brand as part of its restructuring process. Muller’s Spyker acquired the much larger Saab for a bargain price to save it from closure under GM.
