NEWS

Successor to Saab announces $12 billion China electric car deal

Friday, Dec 18, 2015

The China-focussed consortium that bought bankrupt Swedish automaker Saab - and bet on going all electric - unveiled its first major deal on Thursday, a mammoth $12 billion order for electric cars for a Chinese leasing company.

The single order for 250,000 electric vehicles, including 150,000 cars based on the Saab 9-3 sedan, appeared to be all but unprecedented. There were just 665,000 electric cars in the world and 83,000 in China as of the end of 2014, according to the International Energy Agency.

National Electric Vehicle Sweden (Nevs) said it would swiftly hire hundreds of workers in Sweden to start building cars for Panda New Energy, a Chinese firm it said leases zero-emission vehicles to chauffeur-driven fleets.

Those based on the Saab 9-3 compact sedan will have a new chassis for electric drive, with bodies built and painted in Sweden and sent to China for final assembly. No details were given about the other 100,000 but a company spokesman said they would primarily be built in China.

Nevs bought the assets of the bankrupt 70-year-old Swedish automaker in 2012 with the aim of transforming it into a leading global producer of electric cars. It exited corporate reorganisation procedures in April.

"This is a strategic collaboration for Nevs not only in terms of the numbers of vehicles, but it is also an important step to implement our vision and new business plan," Nevs Vice Chairman Stefan Tilk said in a statement.

"Cooperating with many chauffeured car service platforms in China, Panda aims to become one of the biggest electric vehicle leasing companies in the world," Nevs said of its customer.

Nevs, which was created in 2012, has so far sold only a limited number of gasoline-powered cars based on Saab's latest model. The deal is the first it has signed in line with its plans to go electric.

"It will be a huge challenge to produce that many cars. Their around 800 suppliers will make up a substantial part of that challenge," said Skovde University business administration professor Mikael Wickelgren.

Nevs is co-owned by a holding company called National Modern Energy Holdings, as well as the Beijing State Research Information Technology Co. (SRIT) and Chinese industrial park Tianjin Binhai Hi-tech industrial Development Area (THT).

Nevs said at the time of the purchase of Saab's assets that it would convert the Saab 9-3 to electric power, while simultaneously developing an all-new model to produce in Sweden for the European market and in China for the Chinese market.

 

in.reuters.com

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