Most people nearing 80 are probably looking to shift down a gear and enjoy the peace and quiet of their retirement years. But not Bernie Ecclestone; the 79-year old Formula One mogul has joined forces with Luxembourg-based private equity firm Genii Capital to bid for struggling Swedish carmaker Saab. Even if they manage to see off a rival bid (from Dutch carmaker Spyker), Ecclestone and co would have a lot to do in order to turn Saab’s fortunes around. And given that Saab’s last three owners have singularly failed in that respect, we’re not that confident about their chances...
It’s fair to say that Saab is in a sorry state of repair: it hasn’t made a profit since 2001 and last year lost Kr3bn (around £255m). As a result, owner General Motors put it up for sale last January. But Ecclestone hasn’t been put off by the company’s accelerating losses. He told Bloomberg that Saab ‘is a good brand that has probably been neglected by the current owners’. He may have a point: GM has undoubtedly had other things on its mind lately (staving off collapse, for example). But at the same time, if a specialist like GM with all its resources has been unable to reinvigorate the Saab brand, what chance does anyone else have?
Admittedly Ecclestone has form. He came to F1 when it was little more than a cottage industry, a world away from the global multi-million pound business he has helped it become. Handily, he also has experience in the business of flogging cars, having once been a second-hand car salesman. But we shouldn’t underestimate what a big job Saab would be – some argue (including us) that it hasn’t made a decent car for 20 years. So if the Ecclestone bid is successful, it’s going to be a full-time job to turn the carmaker around. Good job Bernie is no stranger to hard work. ‘I don’t think I could do anything half-cock,’ he told MT back in 2008. ‘You’ve either got to do it properly or not do it, one or the other.’
As for Saab’s 3,400 workers, the news is mixed. On the one hand, their jobs are on the line, so anything that rescues the carmaker from oblivion will sound good. On the other, a new owner may well look to create a leaner, low-volume operation, rather than retaining the whole workforce. And even those who do survive will then face the difficult task of actually shifting the things…
In today's bulletin:
Virgin launches retail banking push with Church House deal
Bernie Ecclestone wants to take the driving seat at Saab
Banks take control of ailing Foxtons
Is (a lack of) office politics hindering women's progress?
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