With unconfirmed reports
suggesting that Mahindra & Mahindra (M&M) is planning to acquire Sweden
based car maker Saab, it is almost confirmed that it has more to do with Anand
Mahindra’s dream to become a world leader in electric vehicles in the near
future, besides leaders in everything Information Technology and all kinds of
wheels! There is no denying the fact that Anand Mahindra and his team are
extremely far sighted. When Satyam Computers was up for grabs in 2009, Tech
Mahindra grabbed it and made it into a shining example of the IT industry. The
same philosophy came into play when they acquired Pune based Kinetic Motors in
2008 from Sulajja Firodia Motwani. That got them all geared up in the two
wheeler segment. Similarly when it was time to prop up their utility vehicles
with new technology, they got a cash strapped SsangYong of South Korea and have
almost turned it around. Their tie up with commercial vehicle maker Navistar of
US could have progressed a lot had Navistar played ball. But far sighted also
means cutting dead wood and that’s what they did with Navistar.
But not many are noticing that
Mahindra seems to be the only Indian company pushing hard and getting ready for
the centuries ahead when fossil fuels will dry up and only electric vehicles
will be the name of the game. Thus when the company in 2014 acquired a 51pc
equity stake in the cash strapped Peugeot Scooters, again not many were aware
that this French company has made a lot of inroads into the e-scooter area.
Mahindra’s own e-vehicle dream has just been getting better both in the
two-wheeler as well as four-wheeler arena.
Mahindra Reva Electric
Vehicles Pvt Ltd is the only dedicated Indian company manufacturing electric
cars. Mahindra had bought this Bangalore based company in 2010 from Chetan
Maini when the latter ran it under the name of Reva Electric Car Company.
Now coming to Saab, though it
is not confirmed, two major OEMs from Asia were bidding for this beleaguered
company. Unconfirmed reports suggest that M&M was one of them and the other
was a Chinese company. Saab is currently controlled by National Electric
Vehicle Sweden (NEVS), a Chinese-Japanese investment group that bought the
assets of Saab Automobile two years ago. Saab is cash strapped and is in the
process of reorganisation. NEVS administrator, Lars Eric Gustafsson, said in a
statement on December 1, 2014, “NEVS had earlier intensified negotiations with
two major Asian OEM Manufacturers during the spring of 2014 for procuring
investment for the cash strapped Saab.”
“The negotiations with the two
major OEM manufacturers, both located in Asia, have continued during the
reorganisation period. In the past weeks the negotiations have intensified
considerably, especially with the OEM player which intends to become the majority
owner in NEVS,” the note from Gustafsson said.
“The negotiations with the
above mentioned player have on November 30, 2014 resulted in a signed letter of
intent between the parties, a so called Term Sheet, in which the OEM player has
agreed to become the majority owner in NEVS. The intention is to issue new
shares in NEVS, where the OEM player shall subscribe to the issued shares to
the extent that the OEM player achieves a majority ownership in NEVS. The name
of the OEM player cannot be disclosed due to the present non-disclosure
agreement between the parties. However, the creditors’ committee has been given
some information regarding the negotiations with the OEM player,” the note
Further the note said that if
a positive decision is given y the Board of Directors, the OEM player has
agreed to provide bridge loans to NEVS with Euro 5 million (Rs 38.74 crore) per
month to cover NEVS’ running costs for a continued reorganisation until the
negotiations have been concluded. “According to the established timeframe, it
is estimated that the agreements should be finalised during February 2015 at
the latest,” the note said.
It was on August 29, 2014 NEVS
had filed an application regarding company reorganisation in the District Court
of Vanersborg in Sweden. At a creditors’ meeting on October 8, 2014, the
Distric Court decided that the reorganisation would continue until November 29,
2014. But on December 1, 2014, the NEVS again submitted an application to the
same court requesting that the company reorganisation shall continue for an
additional time period of three months. NEVS’ payment difficulties arose when
its shareholder Qingbo Investment Co. Ltd failed to complete a promised
financial commitment of Swedish Kroner 1.15 billion (Rs 951 crore
approximately) regarding the first phase of NEVS’ business plan.
THE ELECTRIC VEHICLE DREAM FOR MAHINDRAS
Coming back to Saab and its
inherent strengths, it was the passion and purpose that drove Kai Johan Jiang,
to found National Electric Vehicle Sweden and buy the assets in the Saab
Automobile bankruptcy estates a few years back.
Saab has its headquarters are
in Trollhättan, where it designs and manufactures its vehicles. It is also the
centre of research and development efforts. The company in 2014 presented the
Saab 9-3 Electric Vehicle as designed and produced as part of a prototype
series in Trollhättan.
The car was a modified Saab
9-3 Aero Sedan where the batteries were placed under the floor, keeping the
full interior space as well as the luggage compartment intact. The Saab 9-3 EV was
just as practical as the Saab 9-3 Aero with gasoline engine.
The Saab 9-3’s famous
driving-experience was of course preserved in the EV, helped by its low centre
of gravity and a 50/50 weight distribution.
The car was equipped with
lithium-ion batteries from Beijing National Battery Technology, a company
within the Chinese group of green tech companies owned by Kai Johan Jiang’s
company National Modern Energy Holdings Ltd.
The range for the prototype
series of cars was approximately 200 km. Acceleration from 0-100 km/h, happened
in 10 sec and the car attained a maximum speed of 120 kmph. The engine produced
140 hp. If Mahindras were to acquire Saab, the company’s electric vehicle initiative
would only get better.
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