Tag Archives: China

Saab Ownership Transfer Delayed and Spyker Sues GM

The deadline for the transfer of Saab to its new owners, National Electric Vehicle Sweden AB (NEVS), was last week, but the transfer did not take place. SaabsUnited is reporting that NEVS press manager Mikael Östlund has stated that the transfer has been delayed by at least one month. NEVS is confident the transfer will be completed by the end of summer.

Taking over a company that has gone through bankruptcy is complicated, especially a company that sells products worldwide. The transfer will take time. I am hopeful that the Saab name will continue.

Meanwhile, former Saab owner Spyker Cars is suing General Motors (GM) for its part in Saab’s bankruptcy. Autoblog reports that Spyker is suing for $3 billion and claims that GM interfered in Saab’s business practices and forced its bankruptcy. One might wonder how GM could have interfered in a company it owned, but Spyker had purchased Saab from GM. The lawsuit revolves around GM’s mishandling of Spyker’s choice to allow Chinese automaker Zhejiang Youngman Lotus Automobile (Youngman) to invest in Saab. Spyker claims that GM killed the deal, and forced bankruptcy, to avoid competing with Saab in the Chinese market.

Does Spyker have a case? Absolutely. But it the GM – Spyker – Saab relationship is complicated. As SaabsUnited explains, Saab and GM had entered into a Automotive Technology License Agreement with Saab, and that agreement continued after Spyker purchased Saab from GM. Because of this agreement, Saab had access to GM’s platforms and technology, but Saab had a habit of making changes to GM’s platforms in its cars. The concern for GM with Youngman investing in Saab was that they would have access to GM’s technology. However, Youngman would not have had access to Saab’s 9-3, 9-4X, and 9-5 because of the details of the agreement. Instead, Youngman would have loaned money to Spyker allowing for the development of Saab’s Phoenix Platform and the eventual phasing out of GM’s platforms.

Saab’s problems began in early 2011, and Spyker was trying to figure out a solution that would serve its interest and preserve Saab. Spyker’s agreement with Youngman, known as the Framework Agreement, would have allowed Spyker to accept loans from Youngman, but Yougman would not become an equity partner into the company until GM’s platforms were completely phased out. In short, Yougman would have NEVER seen GM’s technology. Sounds like a fair deal, but GM stopped it. This forced Youngman to back out, and Saab was forced to declare bankruptcy in December 2011.

I believe Spyker has a strong case. The Framework Agreement did not involve GM, and even protected them from Youngman. Why did GM object? Clearly they were threatened by a Chinese company that would have certainly brought the next generation of Saab vehicles into China to compete with GM’s offerings. There are certainly two sides to every store, but this appears to be a simple case of a poor sport attempting to defeat the competition before it even had a chance. I have been very vocal about GM’s mishandling of Saab (as I expressed in this post), and I hope Spyker can prove its case. As with the Saab transfer to NEVS, I will continue to follow this story as it develops.

UPDATE: SaabsUnited is reporting that Youngman is also considering legal action against General Motors over their interference in the deal between them on Spyker.


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Tim Cook at D10 – UPDATED

On Tuesday night, All Things Digital’s D10 Conference kicked off with a keynote interview with Apple CEO Tim Cook. Presenters Walt Mossberg and Kara Swisher began by asking Cook about his new postion at Apple and how the death of his friend Steve Jobs has affected him and Apple. Cook became visibly emotional when talking about Jobs, and he recalled that was a genius and said that Apple will remain true to its roots and move forward with its product strategies.

After a few softball questions, Mossberg and Swisher (mostly Mossberg) began to hit on some of the tougher subjects. Cook (reluctantly) discussed patent wars, the controversy over manufacturing in China, and the future of AppleTV. Mossberg asked him if tablets should be categorized as PCs and his response was a resounding “no“. Cook did hint at upgrades to Siri as well as a possible partnership with Facebook, despite saying that Apple was going to “double down” on secrecy. All Things Digital as put together a highlight video that you can see HERE. I will post a link to the full video when it is available.

At times, it seemed that Mossberg and Swisher were bullying Cook with topics that he did not want to discuss, something that Jobs would not have allowed. Cook is very soft spoken, but he is a master at dodging questions. Nevertheless, the information that came out of the D10 keynote was very interesting for those in the tech world. Of course, all eyes will be on Apple June 11 when Tim Cook will take to his own stage at the 2012 Worldwide Developers Conference in San Francisco

UPDATE (June 11): The full video has been posed, you can view it HERE.

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Apple, Foxconn, and Mike Daisey

There have been alot of reports lately about Apple and its supply chain, specifically Foxconn. Nightline was granted access to Foxconn a few months ago, but the Foxconn stories began in 2010 following a series of worker suicides. The story was brought to theater by Mike Daisey in his play The Agony and the Ecstasy of Steve Jobs. His monologue (read the full text) has been widely popular. In it he claims to have visited Foxconn and visited with underaged workers and workers that had been disabled by their work at Foxconn. A few months ago he appeared on the Chicago show “This American Life.” They ran the story and reported his monologue as fact. They did a series of fact checks, but they did not talk with Daisey’s contact in China, known as Cathy. She was his interpreter and he lied to the show about her identity and would not provide her contact information. They were able to find her, however, and she refutes many of his claims. “This American Life” ran a retraction of their story and an interview with the interpreter. They also reinterviewed Daisey, who admitted that some of his monologue was fabricated. The retraction story delves deeper into the conditions of Foxconn, much like Nightline. It is worth the listen.

Daisey’s play has gotten the desired response. It has made many question and investigate Apple’s supply chain. Apple has been more open about their suppliers, but they have published yearly supplier reports since 2005 (read the most recent of these reports HERE). In it they detail the number of violations found (underaged workers, etc.) and they also list suppliers that they had severed ties with because they refuse to comply with Apple’s standards. Every year, they find violations and they have been criticized for not doing more to prevent violations of its own Code of Supplier Ethics. As far as I know, Apple is the only company to do this, and many other companies use Foxconn and the same supply chain as Apple. Apple has been reporting the problems in China for years, on their website for everyone to see. It has just taken us this long to see it for what it really is.

Since the investigation by “This American Life,” Daisey has changed his show so that the facts are better represented. Before being caught by “This American Life,” Daisey appeared on a number of news programs presenting his disturbing findings as fact. He has since admitted to some embellishment. While I believe it was wrong for Daisey to blatantly misrepresent his trip to China, it has called attention to working conditions in China. Conditions are not great, but one thing we have to keep in mind is that China is in the same position the United States at the turn of the century. In 1900, factory conditions in the US were not ideal and it took the Progressive Era for reforms to take place. There has not been a “Progressive Era” in China. Apple, companies and countries can apply pressure to China, but we cannot force reforms. This is side effect of industrialization and it will take time for laws to be put in place to end underage employment, low pay, long hours, and poor conditions. I hope, for the sake of the workers, that this happens sometime in the near future.

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Save Saab (Updated)

2011 Saab 9-3

The Swedish car maker Saab is in financial trouble, since they are no longer a part of General Motors, but now that potential investors have come forward, General Motors is resisting. The potential investors are Chinese and that appears to be the hang-up for the General. They are concerned that Saab will becoming a competitor to Buick and Chevrolet in China. Why be afraid of a little competition?

2011 Saab 9-4

Saab is nearing bankruptcy and is desperate. What is frustrating for Saab fans is that General Motors dropped Saab when it was downsizing a few years ago. Even more frustrating is that General Motors was in the same position a few years ago that Saab is in now, but they are refusing to budge.

2011 Saab 9-5

Come on General Motors. Give Saab a chance to live. It is your fault that Saab is in this position to begin with. Their current10. models are incredible, and it would be a shame to let Saab die.

UPDATE: 12/19: Today it was announced that Saab has filed for bankruptcy protection in Sweden. The automotive company ran out of money in April of this year and suspended operations. The company has been desperately seeking investors and found a few, but General Motors has blocked these deals. The future of Saab is certainly unknown because businesses do not always emerge from bankruptcy like General Motors and Chrysler did in 2009. Of course, they had government backing and Saab does not have that luxury.

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