Saab town caught between hope and despair

Wed Sep 7, 2011 10:00am EDT
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By Mia Shanley and Johan Ahlander

TROLLHATTAN, Sweden (Reuters) - At a sports center next to Saab's sprawling, now idle, factory, former employees gathered for calisthenics last week, one sporting a union shirt that read: "Never never never give up."

The carmaker has never been so close to the end of the road, however. On Wednesday its owner sought creditor protection in a Swedish court so it can reorganize most of its domestic operations and seek funding.

Saab has been trying to hold out for new Chinese owners in the hopes it can win the kind of backing that Volvo, another famed Swedish brand, has had with China's Geely.

The problem is that the regulatory approvals in China could still take weeks. And with its factory silent for months and wages and bills going unpaid, Saab needs the cash now.

Auto enthusiasts and Saab devotees worldwide are anxiously watching to see whether the carmaker can survive, but no-one is more worried about the fate of the firm than the people of Trollhattan, the western Swedish town that is Saab's home.

"They have never been in this deep before," said Lars-Erik Johansson, who worked for almost 50 years at Saab and now enjoys a pensioner's membership to the company's sports complex.

"It is going to be very tough," he said in between exercises in the large aerobics room.

The ultra-modern plant, which can produce about 220 cars a day, employs about 3,400 people. If you include those employed at suppliers and local businesses more than twice that number could be affected by a closure.   Continued...

<p>A general view of Spyker Cars Saab factory in Trollhattan September 7, 2011. REUTERS/Bjorn Larsson Rosvall/Scanpix</p>