Biomass Energy Company Leads Deal to Buy Saab
The Asian consortium planning to rescue Swedish automaker Saab Automobile from insolvency is led by a mainland Chinese alternative energy tycoon whose company has close ties with China's State Grid electricity utility.
Acquiring Saab's car making assets could help bring the huge, state-owned utility a step closer toward its long-sought goal of breaking into the electric vehicle market.
"It's logical if they want to move into that market," said Yale Zhang, managing director of the independent consultancy AutoForesight in Shanghai.
By buying a brand-name, "If they want to build a higher-end EV, it would be easier to penetrate the European, American, even the Chinese market," he said.
Kai Johan Jiang, who was born in rural eastern China, went to school in Sweden and once worked for Volvo Trucks, according to his company's website.
Most of his career has been in the energy sector. His company, National Bio-Energy Group, specializes in building and running power plants fueled by farm waste, such as straw and corn stalks. The State Grid logo is front-and-center on the Bio-Energy Group website.
Another of Jiang's companies, National Modern Energy Holdings, holds a 51 percent stake in National Electric Vehicle Sweden AB, the company set up to buy Saab's main assets. Sun Investment LLC, said to be a Japanese company, holds the remaining 49 percent.
Saab's buyers say they plan to meld Swedish car design and manufacturing know-how with Japanese electric vehicle technology to promote premium electric vehicles in China — a goal that has so far proven elusive.
Jiang and others did not disclose the price tag in announcing their purchase Wednesday of the Saab assets, which include main parts of its auto manufacturing division.
"Chinese customers demand a premium electric vehicle, which we will be able to offer by acquiring Saab," Jiang told reporters at a news conference at Saab's manufacturing plant in Trollhattan, Sweden.
Perhaps, analysts say.
But buying a car factory will not guarantee success in actually making and selling premium electric vehicles, whether in China or elsewhere.
China's economic planners have made development of electric vehicles a top economic priority, driven both by the need to reduce smog and also to curb soaring dependence on imported crude oil.
But so far the market has failed to take off. Providing subsidies at the local level has only helped boost electric vehicle development in a couple of cities where local car manufacturers have relatively strong EV production, says Zhang.
Louise Nordstrom in Stockholm contributed to this report.