April 22, 2010 / 1:31 PM / 10 years ago

UPDATE 2-Spyker says Saab production on track

* Forecasts production of 50,000 units for 2010

* Says Saab breakeven point at 85,000 cars by 2012

* New smaller model at “forefront” of priorities (Recasts throughout with CEO comments, background)

By Ben Berkowitz

ZEEWOLDE, Netherlands, April 22 (Reuters) - Spyker Cars SPYKR.AS said on Thursday that production at Saab was on track, two months after the Dutch sports car maker bought the iconic but loss-making Swedish brand.

Spyker also made clear its strong desire to develop a new, compact model of Saab car if could find the right partner and the proper financing.

Saab Chief Executive Jan Ake Jonsson told shareholders at Spyker’s annual meeting that Saab would meet its target of 50,000 cars sold and nearly 54,000 produced this year.

Jonsson said to meet these goals Saab would ramp up productivity in June beyond its original plan. Spyker bought Saab from General Motors [GM.UL] for $400 million in February, taking on the challenge of turning two historically loss-making automakers into one profitable global car company.

Spyker Chief Executive Victor Muller said Saab’s break even point should be sales of 85,000 cars a year by 2012; analysts have said Spyker must sell at least 75,000 cars a year to be cash flow positive. [ID:nLDE62P0EU]

Spyker shares erased a 2 percent loss after Muller’s remarks and rose as high as 10 percent. They closed up 3.1 percent at 3.23 euros.

The stock briefly doubled in January when a Saab deal seemed possible, then halved as the deal moved toward completion. Since it was closed, the shares have been stuck in a range of between 3.01 and 3.65 euros.

While the company gets its finances in order, it is limited in what it can do beyond its current plan. But Muller made clear he would like to expand Saab’s line-up into the compact segment, with something smaller than the 9-3 model.

“The Saab 9-2 is clearly on the forefront of our priorities,” Muller said during a news briefing after the shareholders’ meeting, adding the market data in support of producing such a car was “irresistible”.

However, Muller made clear that to add such a car to its line-up, Saab would need substantial new capital and also a partner with whom to design and produce the car. He said the model would also have to stand out sharply from the other cars in the segment.

“It has to be something as iconic as a Mini and it has to be a real Saab,” he said. (Reporting by Ben Berkowitz; editing by Karen Foster)

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