Friday, February 20, 2009

SAAB Is The First In A Line Of Manufacturers Who Will Be Forced To Seek Bankruptcy or Reorganization...


What is sure to be a musical chair game of Auto Manufacturers worldwide who will be seeking bankruptcy protection, Saab the company owned by General Motors has filed for reorganization and bankruptcy protection from the Swedish court system.

Saab is seeking $1 Billion ($793 million euros) from General Motors to become self-financing as it goes through the process of breaking away from General Motors and become a "independent business entity". As it will concentrate its production, it's designing and engineering in Sweden.

GM has been asking the Swedish government for $600 Million Dollars to provide Saab a healthy balance sheet so that it can seek additional outside funding. GM said it would only provide Saab funding to support liquidity not to further support additional projected losses.

Expect Saab to be the first in a line of other automakers and brands to find protection from creditors as the credit crisis worsens. If large, medium and small businesses can't get access to loans for development, inventory and financing of thier products then the only way this mess is going is down, that's why I couldn't support the bailout for the banks and finance companies from the beginning of the meltdown.

Enjoy Today!
That Car Guy

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