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This morning, General Motors (GMGMQ) -- or is it Government Motors? -- announced that it will sell its Saab unit to a consortium led by Koenigsegg Automotive AB. The purchaser is a luxury carmaker, which produces roughly 12 custom-made models each year. In a memo of understanding, GM stated that the sale will include a $600 million funding commitment from the European Investment Bank -- which is guaranteed by the Swedish government. The sale is believed to be completed by the end of the third quarter.
GM's European President, Carl-Peter Forster stated, "This is yet another significant step in the reinvention of GM and its European operations. ... Closing this deal represents the best chance for Saab to emerge a stronger company." Saab's CEO called the deal "great news," adding that it will help the brand maximize its potential through" an exciting new product lineup with a distinctly Swedish character."
All parties involved believe that this deal is "interesting" and holds a great deal of potential. But was it really a good move for the tiny Swedish automaker Koenigsegg? I think so. It will allow this small luxury manufacturer to branch out and produce cars for the general public's consumption.
Not all are enthralled with this deal, as some have suggested that Saab should be left to its own devices to either thrive or fail. Of course, perhaps this is the tract our government should have taken with General Motors.
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