Saab production delay a sign of deeper concerns?

Saab is about to arise once more in the Australian market, but it seems the company still faces some challenges in its home market.

Production at the company's Trollhattan plant ground to a halt two days ago after a logistics company refused to deliver parts to the facility. Mediation between the manufacturer and supplier led to production resuming the following morning.

Saab's parent company, Spyker Cars NV, released an announcement yesterday, which essentially outlined the issue and its resolution in the short term. The press release also acknowledged that Saab Automobile is engaged in "longer term solutions to further strengthen its financial position and improve its capital structure." According to the statement from Spyker, Saab is liquid without needing to draw down from other sources.

The parts supply problem is not completely resolved, the Wall Street Journal reported yesterday. Saab has remitted partial payments to transport company DB Schenker as a gesture of goodwill -- sufficient for the supplier to recommence deliveries to the plant. Other companies have put a stop to providing goods or services to Saab, the WSJ reported in the same article -- and former Saab owner GM may be one of those. Apart from parts suppliers, Saab's advertising agency has also cancelled all work for the car manufacturer.

A worker and union member quoted in the WSJ report said that the Just-in-Time process of parts delivery was often interrupted and DB Schenker's decision to pull the plug on parts supply two days ago was nothing new.

Word leaking out that Saab's suppliers are demanding to be paid is expected to impact on the company's reputation in the marketplace -- a reputation that has already taken quite a hit, as the WSJ article further explained. Saab's CEO Jan Ake Jonsson has resigned, although he will stay on until May, and Swedish newspaper Svenska Dagbladet also reported that the company's new CFO resigned before he had even started work in the role. The Svenska Dagbladet article also highlighted the departure of Pieter Heerema from Spyker's board of management. Heerema was a major financial supporter of Saab.

So the Saab news appears to be hurting the parent company too. Spyker has posted a large loss for 2010 and shares have lost 20 per cent of their value since the day before the loss was announced.

It seems Saab, which began life in the aeronautical industry, faces some turbulent times before it reaches 'clear air'.

Read the latest Carsales Network news and reviews on your mobile, iPhone or PDA at carsales' mobile site...