Saab could face bankruptcy

23rd June 2011, Comments 0 comments

Production at car manufacturer Saab has been halted as the company is unable to pay employees and suppliers. It does not look like production will resume any time soon and the Swedish company currently owned by Dutch car tycoon Victor Muller could face bankruptcy.

“It is clear that the company has its back to the wall. Without supplies cars cannot be produced and no money is coming in. It’s a tricky situation,” says analyst Martin Crum of the Amsterdams Effecten Kantoor AEK.

The main thing is to reach agreement with suppliers. In addition Chinese investors, who have indicated they are willing to put money in the company, need permission to do so from the Chinese authorities.

Victor Muller owner of Saab Swedish Automobile launched a proposal on Wednesday to pay 10 percent of the company’s debts when production resumes. There are signals that the suppliers are willing to agree to this which means they are not likely to push the company over the edge. Swedish unions, however, are considering bankruptcy as an option.  

© Radio Netherlands Worldwide

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