Manufacturing News

With Saab's demise, Chinese have lost their chance to buy more global brands

Now that Saab Automobile is dead, the opportunity for Chinese automakers to acquire another global brand is just about gone.

That's a very big deal for China's domestic automakers, which are struggling to compete because of their weak brands and weak technology.

Zhejiang Youngman Lotus Automobile Co. and Pang Da Automobile Trade Co. lost their bid to acquire the Swedish automaker after General Motors -- Saab's former owner -- blocked the deal.

This week, Saab was declared bankrupt by a Swedish court.

With Saab soon to close, are there any other global auto brands up for grabs? Opel could be one, some observers might say.

Opel, which GM nearly sold in 2009, is bleeding money once again. Europe's deep economic woes will make it hard for Opel to regain profitability any time soon.

Rumors that GM may sell Opel have circulated for quite a while. But will GM actually sell it to a Chinese company? No, it won't.

Buick is GM's strongest brand in China, which soon will become the automaker's biggest global market.

Opel cars, like Saab vehicles, share technology with some Buick models. So GM would rather kill Opel -- just as it did with Saab -- than allow a Chinese suitor to buy it.

In retrospect, Zhejiang Geely Holding Group president Li Shufu was lucky to pluck Volvo from Ford Motor Co.

But that was in the middle of the global recession in 2009, when everybody feared the auto industry would collapse.

After a flurry of government rescues, global automakers like GM and Chrysler are back on a relatively solid footing.

These days, nearly all second-tier international brands are either owned by or share technology with major global automakers.

Moreover, just about every major global automaker has a presence in China. None of them would risk jeopardizing their operations by allowing a domestic Chinese company to acquire an international brand that they share technology with.

That's why GM denied Youngman the chance to own Saab. And that's why Chinese companies are unlikely to acquire another global brand.

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