Saab prepares to restart production as Pangda chief set to visit Swedish factory

Struggling carmaker Saab yesterday said it was gearing up to restart its production line in Sweden today, after being idle for six weeks due to cashflow problems.

Saab owner Spyker has been struggling to turn round the Swedish carmaker since its acquisition from General Motors last year. It ran out of cash to pay suppliers in April, halting production and pushing it to the brink of collapse.

"Based on the information we have, it looks like we will start up production (on Friday]," spokeswoman Gunilla Gustavs said.

The carmaker has been in intense negotiations with suppliers in recent days. Gustavs said agreements had been reached with a sufficient number to allow for a resumption of output from its plant in Trollhattan, in south-west Sweden.

"We have a critical mass to get production started," she added. Spyker has been seeking solutions to ease its cashflow problems but has had to wait for approval from authorities in Sweden and the European Investment Bank, according to the terms of an outstanding loan.

Chinese car distributor Pangda is waiting for regulatory approval at home for its rescue of Saab in a deal worth up to €110 million (95m).

Spyker received an advance payment of €30m from Pangda last week and had set a goal to restart production by the end of this week, in time for a visit by Pangda chief executive Pang Qinghua.