Ever since NEVS’ application for reorganisation was approved by the Värnersborg district court on August 29th, many speculations were going round. First of all around the reason for initial rejection and then approval only a day after of the application, but then in particular around what possibly the plan for resurrection would look like.
For many, this really was a déjà vu of a seemingly same scenario from 2011 when SAAB Automobile AB first filed for reconstruction and later went bankrupt.
In the most recent application NEVS filed this year, the plan was to essentially find a new majority owner and to start an R&D joint venture. In neither of the cases the interested parties were mentioned by name and NEVS subsequently has refused to confirm whether they were indeed negotiating with Indian Mahindra, Chinese Dongfeng and even French PSA as several sources were suggesting.
Today’s letter to the creditors and the preliminary detailed version of the reorganisation plan didn’t change this situation, but confirmed that two parties have expressed an interest in respectively “developing SAAB to a global premium brand by providing both financial resources and industrial infrastructure” and “collaboration on the product development and technology, including the completion and development of the Phoenix platform”. This is still “plan A”.
NEVS continues to confirm that progress is being made but the tricky part with “plan A” is that the negotiations are clearly not advancing as planned, with additional hurdles like the (temporary?) withdrawal of the license to use the SAAB brand and the announced lay-offs of 155 workers earlier this week. Many questions are still unanswered: who are these companies? What is keeping them from closing the deal? Will this be enough to secure a long-term solution or will we be seeing another repeat of reconstruction / bankruptcy again in the near future?
It seems that the reorganisation administrator and NEVS themselves really aren’t sure themselves as a “plan B” is being introduced now: starting “NEVS Industrial Services”, a new company that would focus on providing several services to the open automotive market. The reorganisation document is positioning this as both a complementary scenario to “plan A” as well as a complete alternative to it, where essentially NEVS would be reinvented as a company and would significantly change course.
Is either of the scenarios going to materialize or will there be a “plan C” eventually? Very difficult to tell and time isn’t really on NEVS’ side with the creditors meeting planned for Wednesday the 8th and a deadline for the reorganisation of November 29th. Meanwhile costs continue to build up and damage to the brand lingers on. On the bright side, the development work on what seems to be NEVS’ key assets –the Phoenix platform and the next gen EV- hasn’t stopped during the entire period and is still going on today.
I really hope it will be sufficient.