Saab to cut costs after reorganisation approval
The Swedish court of appeal’s decision to allow the carmaker to seek bankruptcy protection reverses the previous district court conclusion that reorganisation would bring no significant increase in the chances of the firm’s survival. It now allows Saab to reorganise, including brining in Chinese investors and starting production again.
Now the automaker has said that it will look to create a more flexible and more competitive cost structure for the company’ and will ‘identify areas throughout the whole organisation where efficiencies can be gained’.
It added: ‘The initiative will focus on both fixed and variable costs and aims to create a lower and more flexible cost structure within Saab Automobile by eliminating duplication of work, streamlining processes, shortening lead times, improving coordination between departments and simplifying the organizational structure. As a result of this initiative headcount reductions cannot be ruled out.’
The new efficiency initiative will be rolled out before the end of the year.
In June, Saab said two Chinese car companies, Pangda Automobile Trade Co Ltd and Zhejiang Youngman Lotus Automobile, had agreed to take a combined majority stake in the firm. The deals are still awaiting approval from the Chinese authorities.
For more of the latest industry news, click here.