China's NEVS suspends Saab output in Sweden amid cash shortage
China's National Electric Vehicle Sweden has temporarily halted output of Saab cars because of a shortage of funds, the company said this week.
NEVS, which last year resumed low-volume production of Saab cars after it bought the bankrupt Swedish brand, said it lacked enough cash to pay outstanding debt.
"The reason is that NEVS' part-owner, Qingbo Investment Co., has not fulfilled its commitment to, when necessary, finance NEVS' activity," the company said Tuesday in a statement.
"NEVS is therefore making a temporary and controlled halt of production, which hitherto has been six cars per day, and is reducing agency staff."
Beginning Thursday, the Trollhattan plant in south Sweden was to be idled for four weeks, NEVS spokesman Mikael Ostlund said.
Qingbo is the investment agency of the city of Qingdao, which bought a 22 percent stake in NEVS last year and has ordered a fleet of 200 Saab electric vehicles for the city.
"Qingbo hasn't terminated the deal. They say they will complete it. But we haven't received the financing they had agreed with our main owner," Ostlund said.
NEVS is betting on an as-yet-unbuilt electric version of a decade-old Saab model to revive the brand. It is targeting its home market of China, where the government is promoting clean automotive technology.
Ostlund said, "We are now seeking bridge solutions until sometime in June when we expect to have the result of the discussions with the intended partners."
"The reason is that NEVS' part-owner, Qingbo Investment Co., has not fulfilled its commitment to, when necessary, finance NEVS' activity," the company said Tuesday in a statement.
"NEVS is therefore making a temporary and controlled halt of production, which hitherto has been six cars per day, and is reducing agency staff."
Beginning Thursday, the Trollhattan plant in south Sweden was to be idled for four weeks, NEVS spokesman Mikael Ostlund said.
Qingbo is the investment agency of the city of Qingdao, which bought a 22 percent stake in NEVS last year and has ordered a fleet of 200 Saab electric vehicles for the city.
"Qingbo hasn't terminated the deal. They say they will complete it. But we haven't received the financing they had agreed with our main owner," Ostlund said.
NEVS is betting on an as-yet-unbuilt electric version of a decade-old Saab model to revive the brand. It is targeting its home market of China, where the government is promoting clean automotive technology.
Ostlund said, "We are now seeking bridge solutions until sometime in June when we expect to have the result of the discussions with the intended partners."
