A year out of bankruptcy and with just two cars a day rolling off its production line, Saab is betting on an as yet unbuilt electric version of a decade old car to bring the iconic Swedish marque back from the dead.
Saab’s new owner, National Electric Vehicle Sweden (NEVS), is targeting its home market of China for that revivial.
Reuters Newsagency reports that’s because the Chinese government is promoting clean automotive technology with up to US$16 billion in vehicle subsidies, Research and Development and infrastructure spending, according to research firm Frost and Sullivan.
However, the battery version of Saab’s 9-3 model will be up against the likes of BMW, VW and Ford in one of the most competitive industries in the world.
Even die-hard fans are sceptical.
The 9-3 is “already out of date” from a new buyer’s point of view, Chih Hao Yeh, who runs Saab Club Taiwan, said by email to Reuters.
As for the electric version, “will it offer the pure driving pleasure regular Saabs do?” he asked.
For NEVS President Matthias Bergman, only bold action will resurrect a more than 60-year-old brand, which pioneered such auto innovations as side-impact protection, heated seats and headlight washers.
However the company was hurt by high labour costs and lost its quirky image under General Motors’ ownership.
“We are nearing a tipping point,” he told Reuters, predicting the market for electric vehicles (EVs) will turn up sharply around 2015.
“The big volumes will be in China.”
Saab also has a few aces up its sleeve, such as its state-of-the-art plant in Trollhattan, south Sweden, courtesy of GM’s $4 billion of investment.
It will also have cheap batteries supplied by NEVS’ sister company Beijing National Battery Technology, as well as political connections.
Quingdao city paid US$305 million for a 22 percent stake in NEVS earlier this year and has ordered a fleet of 200 EVs for delivery next year.
Analysts think sales of EV fleets to local governments in China are a huge opportunity, as they own hundreds of thousands of vehicles and are under pressure to cut air pollution.
Quingdao, in eastern China’s Shandong province, has a population of nine million, the same as the whole of Sweden, and NEVS Chief Executive Kai Johan Jiang believes demand for EVs in China will quickly outstrip supply.
“Electric cars will be a scarce commodity in China,” he said as the first Saab, a conventionally powered, black 9-3, rolled off the line in Trollhattan, Saab’s home since the late 1940s.
Reuters reports Beijing is ramping up a programme to put five million all-electric battery vehicles and near all-electric plug-in hybrids on the road by 2020.
In September, it renewed subsidies for buying green cars worth up to US$9900 for an all-electric car.
The challenge for Saab is immense, however, as manufacturing in Sweden will make cars expensive, at least until a plant in China comes on line, while NEVS lacks the financial muscle of rivals.
While acknowledging the challenges, Mr Bergman predicted demand would grow at a similar pace to Saab’s ability to meet it.
Trollhattan has a capacity of 190,000 cars a year, and NEVS already has plans for a second facility in China.
“We are not going to sit on the sidelines until the electric car market starts to be attractive, we are going to take an active role in ensuring that the technology shift actually happens,” Mr Bergman said
2 Responses