American Suzuki files for bankruptcy protection

The Associated Press , Staff

BREA, Calif. - American Suzuki Motor Corp. on Monday filed for Chapter 11 bankruptcy protection and said it will cease selling automobiles in the U.S. as part of a plan to restructure its business.

The company, based in Brea, Calif., is the sole distributor of Suzuki Motor Co. vehicles in the continental U.S.

In documents filed with the U.S. Bankruptcy Court in the Central District of California, the company estimated that its debts and liabilities range from at least $100 million to as much as $500 million.

It also said it has between 1,000 and 5,000 creditors.

American Suzuki Motor said it has enough cash to operate during the restructuring and intends to honor all car warranties and buyback agreements. It will work with its car dealerships to help them transition into parts-and-service operations. In some cases, the dealerships will be shuttered, it said.

Once it exits bankruptcy protection, American Suzuki Motor said it will focus on selling Suzuki motorcycles, all-terrain vehicles and marine outboard engines.

It said that it is exiting the car business because of slow sales, unfavorable foreign exchange rates and high costs due to U.S. regulatory requirements.

It sold 2,023 vehicles in October, which was up 5 percent from the same month last year. Its Grand Vitara sport utility vehicle posted a 64 percent jump in sales last month, although American Suzuki did not say how many of them were sold. In May, the last month it provided a breakdown of its sales, it moved 474 Grand Vitaras, while its biggest seller was its SX4 small crossover, of which 1,101 were sold.

The bankruptcy and reorganization are unrelated to its parent Japan-based Suzuki Motor Corp., which intends to buy the American subsidiary's remaining businesses and automotive service operation.

The reorganized company will retain the American Suzuki Motor name, the company said.

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Struggling Saab wins bankruptcy protection

STOCKHOLM — Struggling car maker Saab gained fresh breathing room in its fight for survival on Wednesday when it won a court appeal to be granted protection from creditors while it awaits Chinese investment.

A court of appeal in west Sweden said in a statement it had overturned a lower court decision which had rejected allowing Saab the protection it sought, known as a reconstruction.

It said there was "no reasonable reason to consider that the goal with a reconstruction cannot be met."

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Saab hopes creditor protection will allow it to survive until China's authorities approve a 245 million euros ($336 million) investment by car firms Zhejiang Youngman Lotus Automobile and Pangda.

Saab, owing August wages to workers and 150 million euros to suppliers, sought protection from creditors this month, but was turned down by a lower court.

Owned by Netherlands-listed Swedish Automobile , the company backed up its appeal by pointing to, among other things, agreement for 70 million euros of bridge financing with the help of a guarantee from Youngman.

Three unions representing workers at Saab have sought the company's bankruptcy to activate a state scheme to pay wages. But creditor protection also activates that scheme.

Blue collar union IF Metall said in a statement this meant its bankruptcy application was no longer needed.

"Now the company and its employees will get a much needed breathing space systematically to develop a long-term business plan," IF Metall chairman Stefan Lofven and the IF Metall Saab chapter head Hakon Skott said in a statement.

Production at Saab has been more or less at a standstill since April when unpaid suppliers pulled the plug on deliveries.

Sweden's debt collection agency had already begun seizing assets at the behest of unpaid suppliers.

Copyright 2011 Thomson Reuters.

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Saab denied bankruptcy protection

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STOCKHOLM — Troubled automaker Saab, known for its quirky, rounded cars, moved closer to financial collapse Thursday after a Swedish court rejected its request for bankruptcy protection.

The ruling by the Vanersborg District Court means the Swedish brand, which has struggled financially since General Motors Co. sold it to Netherlands-based Spyker Cars in 2010, is now only days away from facing bankruptcy action from trade unions. Spyker has since changed names to Swedish Automobile.

The company has struggled to pay suppliers and staff, and production at its manufacturing plant in Trollhattan, Sweden, has been suspended for most of the year.

Swedish Automobile said it would appeal the court's decision before the deadline on Sept. 29.

However, it is unclear whether the appeals court will accept the request and the unions representing Saab's 3,700 employees said they would take bankruptcy action within days on behalf of members still waiting for their August salaries.

Bankruptcy protection in Sweden is similar to Chapter 11 in the United States, allowing a company to reorganize, buying it time to improve its finances and stave off liquidation. During that period the Swedish government pays employees' salaries. That government salary guarantee also kicks in if a company is declared bankrupt.

Swedish Automobile had submitted an application for bankruptcy protection on Wednesday, including plans for a reorganization it claimed would help revitalize the brand.

But the court said it remains unclear how Saab — which underwent a reorganization under GM in 2009 — will find the money it needs to stay afloat.

Swedish Automobile's Dutch CEO, Victor Muller, is hoping for a €245 million ($344 million) cash injection from Chinese investors Zhejiang Youngman Lotus Automobile Co. and Pang Da Automobile Trade Co. that is currently awaiting regulatory approval.

"It appears unclear if — and if so when — the relevant Chinese authorities will approve the agreements," the court said, adding that other financial solutions presented by the company don't seem sustainable.

"In sum, the court finds that it appears unclear how the company will be able to solve the liquidity crisis and continue operations," the ruling said.

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Saab said in a statement it was "disappointed" and would appeal the decision and update the market "on further developments" Friday. It gave no details.

Hakan Skott, local club chairman of labor union IF Metall in Trollhattan, called the court's decision "sad" and said union members will consider filing bankruptcy proceedings against Saab within "the next couple of days."

"We are nearing 14 days without salary payments and the financial situation is becoming very difficult for some of our members," Skott said.

Unionen, a labor organization for white-collar workers, said it would wait no more than three days before filing a bankruptcy petition for Saab — if the company doesn't do it before then.

"It is our opinion that an employer that ends up in a situation like this should put itself into bankruptcy," said Martin Wastfelt, the union's chief legal advisor.

Tom Muller, an analyst at Theodoor Gilissen in Amsterdam, said he believes the unions can wait a maximum of two to three days before making a bankruptcy filing.

"The company can do only one thing and that is to give them money," said Muller, who is not related to the Swedish Automobile chief executive. "The members have to eat. ... People cannot live on promises."

He said he doesn't believe Swedish Automobile will manage to find the funds in time.

"It's a good car, there is nothing wrong with the product, but it's the financial situation that's the problem," he said.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Sweden's Saab files for bankruptcy protection

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STOCKHOLM — The owner of cash-strapped car maker Saab filed for bankruptcy protection on Wednesday in a last-ditch attempt to salvage a brand crippled by production stoppages, withheld salary payments and mounting debt.

Swedish Automobile, formerly known as Spyker Cars, said Saab and its subsidiaries Powertrain and Tools were included in the application for a voluntary and "self-managed" reorganization filed at a local court in southwestern Sweden. Overseas units were excluded.

If approved by the court and Saab's creditors, an initial three-month court-administered reorganization phase would halt any debt collection processes as well as potential bankruptcy filings. Some of Saab's creditors have threatened to put it into bankruptcy amid its problems in paying suppliers and staff.

The Netherlands-based Spykers Cars changed its name to Swedish Automobile after deciding to focus only on the Saab brand. Led by Dutch businessman Victor Muller, the company has failed to revive the loss-making brand since taking it over in 2010 from General Motors Co., which was in the process of dismantling it.

Failure to pay suppliers for parts forced it to suspend production at its plant in Trollhattan, Sweden. Salary payments for many of Saab's 3,700 workers have been postponed in recent months as the liquidity crisis worsened. These salaries will be sought for under Sweden's state's wage guarantee scheme.

The application for creditor protection calls for cutting costs and "creating a viable, competitive and independent organization," Swedish Automobile said.

"The eventual purpose of the proposed voluntary reorganization process is to secure short-term stability while simultaneously attracting additional funding," the company said.

Saab is hoping for cash injections from Chinese investors Zhejiang Youngman Lotus Automobile Co. and Pang Da Automobile Trade Co. The deals include the manufacturing and distribution of Saab cars in China, but have been delayed because of pending approvals from authorities.

Muller, who is CEO of Saab and Swedish Automobile, said that "a voluntary reorganization process will provide us with the necessary time, protection and stabilization of the business, allowing salary payments to be made, short-term funding to be obtained and an orderly restart of production to be prepared."

He warned that the process would lead to "a number of tough issues and decisions" but added that he believes Saab will exit the process as a stronger and leaner car brand, putting much faith on the future cash expected from Pang Da and Youngman.

Darko Davidovic, union legal adviser for IF Metall which represents around 1,500 Saab workers, welcomed the move. "It is the fastest way four our members to get their money unless the company pays up itself," he told The Associated Press. "All other alternatives would have been worse," referring to a potential bankruptcy which would have drawn out payments.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Saab denied protection

STOCKHOLM-troubled automaker Saab, known for his quirky, rounded cars moved its request for bankruptcy protection closer to financial collapse Thursday after a Swedish court rejected.

The judgment of Rattvik District Court means that the Swedish brand, which has struggled financially, because General Motors co., Netherlands-based Spyker sold cars in 2010, now only days before the bankruptcy action of trade unions before. Spyker has since changed name to Swedish car.

The company has fought Sweden, most of the year was interrupted for the suppliers and employees, and production in its plant in Trollhattan, to pay.

Swedish automobile said that it the decision of the Court before the deadline to Sept. 29 would appeal.

It is unclear whether the Court of Appeal accepted represented 3,700 employees said the request and the unions Saab, that they within bankruptcy days for members still awaiting their August salaries would be.

Bankruptcy protection in Sweden is similar to Chapter 11 in the United States, allowing a society, reorganize time to improve their finances and wound up avoid buying. The Swedish Government employee salaries paid during this period. The Government salary guarantee occurs even if a company in bankruptcy.

Swedish car filed an application for bankruptcy protection on Wednesday, including plans for a reorganization, it claimed would help reinvigorate the brand.

But the Court said it remains unclear how Saab - in 2009, she was a reorganization under GM - the money needs to find water.

Swedish car Dutch CEO Victor Muller, hoping for a 245 million € ($ 344 million)Cash injection of Chinese investors Zhejiang Youngman Lotus Automobile Co. and Pang as automobile trade co., the currently regulatory approval is waiting.

"It seems unclear if - and if so, when - the Chinese authorities approve the agreement" the Court said, adding that other financing solutions, non-sustainable seem presented by the company.

"In sum, the Court notes that it seems unclear, how the company can the liquidity crisis to solve and operations," the ruling said.

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Saab said in a statement, it was "disappointed" and would appeal the decision and update of the market "further developments" Friday. It gave no details.

Hakan Skott, Heimatverein of Chairman of Trade Union IF metal in Trollhattan, the decision of the Court called "sad" and said Union members checks filing bankruptcy proceedings against Saab in "the next couple of days."

"We are approaching 14 days without salary payments and the financial situation is always hard for some of our members, said Skott."

Union, an organization of work for employees, said it would wait no more than three days before the filing of a bankruptcy petition for Saab - if the company does not do it until then.

"It is our opinion that an employer, which ends in a situation like this even in bankruptcy, after", said Martin Wastfelt, senior legal advisor to the Union.

Tom Muller, analyst at Theodoor Gilissen in Amsterdam, said that he believes that trade unions can maximum wait two to three days before the filing of a bankruptcy.

"The company can do only one thing and that is to you money," said Muller, not related to the Swedish car Chief Executive. "The members have to eat." ... "People can not promise life."

He said he does not believe that Swedish car the means be able to find at the time.

"It is a good car, there is nothing wrong with the product, but it is the financial situation, which is the problem," he said.

Copyright 2011 of the associated press. All rights reserved. This material cannot be published, sent, rewritten or redistributed.

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Sweden's Saab files for bankruptcy protection

STOCKHOLM - the owner of the coffers of automaker, on Wednesday in a last-ditch effort to save Saab for protection submitted a mark, debts crippled production losses, salary payments and to assemble withheld.

Swedish car, formerly known as Spyker cars, Saab and its subsidiaries, the Powertrain, and tools in the application for a realignment of voluntary and "self-managed" said filed that were included on a local court in the southwest of Sweden. Overseas units were excluded.

The Court and Saab of the creditor must, a phase of the first three months would court all collection operations managed reorganisation debts as well as the possible bankruptcy stop submissions. Some of the Saab of creditors have threatened to it into bankruptcy in their problems on paying suppliers and employees.

The Netherlands-based Spykers cars changed its name in Swedish car after the decision to focus only on the Saab brand. Under the direction of Dutch businessman Victor Muller, the company could the loss-making brand since he in 2010 from General Motors co., which was to revive it when the disassembly.

Suppliers of parts forced Sweden to suspend production at its plant in Trollhattan, for non-payment. Salary payments for many of the Saab deteriorated in recent months as liquidity shifted 3,700 workers crisis. These salaries are among the Swedish state wage guarantee scheme for aim.

The application for bankruptcy protection for cost reduction and "Creating a viable, competitive and independent organization" calls, said Swedish car.

"The ultimate purpose of the proposed voluntary reorganization to secure short-term stability while at the same time attracting additional resources," said the company.

Saab hopes cash injections by Chinese investors Zhejiang Youngman Lotus Automobile Co. and Pang da automobile trade co. The offers include the production and distribution of Saab cars in China, but due to the pending approvals by authorities have been delayed.

Muller, the CEO of Saab and Swedish car, said that "a voluntary reorganization is the time required, the protection and stabilization of business us." so that salary payments made to obtain short-term financing and prepared an ordered restart of production

He warned that the process to "Results in a number of difficult issues and decisions", but added that he believes that Saab put great confidence to the future cash Pang da and Youngman expects as a stronger and leaner car finished.

Darko Davidovic, union legal advisor for IF metal represents approximately 1,500 Saab workers, welcomed the move. He said "it the fastest four of our members, their money to get, unless the company pays itself," the associated press. "All alternative worse," the payment would have had on a possible bankruptcy.

Copyright 2011 of the associated press. All rights reserved. This material cannot be published, sent, rewritten or redistributed.

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