More Drama From Sweden: Saab Production Halted

Talk about a messy situation if there ever was one!  Lots of dramatic things have been coming from Sweden lately. Remember Scania (who itself used to own Saab?) Things keep getting darker and darker by day for the Saab brand. Now comes news that Saab's entire production line at the plant in Trollhättan has been stopped.

 The report today from Swedish news site The Local states that Saab has failed to pay customs duties and as a result, the Swedish Customs Agency has halted all transportation of goods to and from the plant.

Since parts that Saab requires to continue production are sourced outside of the European Union from various other suppliers and General Motors factories, this has the effect of shutting down the entire production line.

There must be a very large some of money involved for them to take this dramatic step, espessially with the condition Saab is in right now.

Han Ohlsson from Swedish Customs says is "considerable" and that Saab either has to find the money somewhere (good luck!) or finding someone who will pay the debt on their behalf.

According to Ohlsson, Saab now has the option of either finding the money somewhere or finding somebody who will pay the debt on their behalf.

"They would have to pay all of Saab's credit. Saab is not getting a penny of credit from us," he said. Ouch! Not much love for Saab is there?

Saab's future is very uncertain, with it no longer getting support from General Motors (which itself is on life support). After the recent formation of a seperate entity and bankruptcy filing, they longer are claiming any responsibility from the brand, basically leaving it to fend for itself.

The government of Sweden also has shown little enthusiasm in offering money to help keep the brand afloat as it tries to spinoff.

It certainly is a difficult situation. I understand the government's reluctance in the sense that it will be very hard for Saab to survive on it's own in these difficult conditions.

The best option would be to find a new company to purchase them, but again chances of that are slim right now. Again, every way you look at it, it's a difficult situation.

Hopefully Saab can put together a viable restructuring plan that will garner support from private capital and government as well.

It's clear that another path needs to be taken in order for the brand to survive (maybe a move upmarket?). I think it's clear that if Sweden wants to have any of it's automakers left, they will need to lend support. Guess we'll have to wait and see.