Suppliers put brakes on Swedish car maker

6 April 2011

6 April 2011 | Angeline Albert

Saab has been forced to stop production at a factory in Sweden after deliveries of parts were halted by suppliers who have not been paid. 

Production lines at the carmaker’s Trollhättan factory have been suspended several times over the past five days because suppliers were unhappy about their payment and supply terms.

The disruption to factory operations began on 31 March when logistics supplier Schenker, which provides Saab with trucks to deliver parts, withdrew its services, as did the car parts maker IAC, a supplier of dashboards and door panels. 

Saab, which has 800 suppliers in total, said it has since come to an agreement with both vendors, so production could continue. Talks with a number of other suppliers are ongoing. 

In a statement, parent company Spyker Cars said: “Certain suppliers halted supplies to Saab Automobile pending discussions about payments and supply terms. Saab Automobile expects to resolve these issues in the short term, also to prevent any further disruptions in supply. Saab Automobile has sufficient means to meet its immediate liquidity needs from existing and available sources. In addition, Saab Automobile continues to work on longer-term solutions to further strengthen its financial position and improve its capital structure.”

A spokeswoman for Saab Automobile told SM: “Some suppliers have been affected by a tightened liquidity experienced by Saab in the past quarter. We are working to strengthen the financial strength of the company long-term, so that we don’t run into issues going forward.”

The Trollhättan factory produces a number of Saab vehicles, including the 9-3 Sport Sedan, 9-3 SportCombi, 9-3 Convertible, 9-3X and 9-5 Sedan.    

Spyker’s annual report revealed that Saab urgently requires extra funds to operate. In February 2010, Spyker Cars of the Netherlands acquired Saab Automobile for £45.6 million from US automotive company General Motors.

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