Saab 92 Coming for 2014

Just the Facts:

• Saab will add a small premium car to its lineup by 2014.
• The new small car is expected to be priced 10 percent above the cost of a Mini.
• Saab also says a hybrid 9-3 is coming, and there will be full electric Saabs by 2016.

TROLLHATTAN, Sweden — Saab boss Victor Muller will decide how the company will go about adding a new premium small car to its range in "the next 100 days."

The choices, Muller says, include using a scaled-down version of the next-generation 9-3 platform, or more probably doing a deal with another carmaker for a suitable platform. That maker, he says, will likely be European. Ideally Muller would like to see the 92 enter production in 2013, but a 2014 introduction is more probable.

Muller says the new 92 must be "stunning to look at, ingenious and an outstanding premium product." And, he says, it will not be retro: "We hate retro at Saab. It's a teardrop car and premium, but that's where the comparison ends."

He reckons that the original 92 established the premium small car, and sees the new 92 as "clawing that territory back." It will also include hybrid versions, he says.

The design, dimensions and specifications of the 92 have already been determined and, says Muller, the pricing will be "Mini plus 10 percent." He believes the 92 can command a premium because it will be more exclusive than the Mini, built at the rate of "30,000 to 60,000" annually.

Despite its continuing ties with GM, Saab rejected using the GM Delta platform, adds CEO Jan-Ake Jonsson, because GM will eventually spawn 27 models from it and Saab felt it would not get the necessary product differentiation.

Saab has an agreement with GM, incidentally, allowing it use the next-generation Epsilon platform for the 9-5 that will replace the now-launching 2011 model, taking it to 2024. But more likely is that it will use a stretched version of the current 9-3 platform, which is being extensively reworked to create the new 9-3 for 2012. That car is effectively getting a pre-launch make-over to make it more Saab-like than originally planned.

Saab's immediate product plans run like this: April 2011, 9-4X; late 2010, 9-3 face-lift; June 2011, 9-5 Sport Combi wagon, and a gasoline-engine 1.6-liter turbo for Europe; June 2012, all-new 9-3, by which time the 9-5 launching now will be the oldest model in the range. That last is an unprecedented circumstance for Saab, which has become infamous for the excessively extended lives of its models.

On the ecological front, a hybrid 9-3 is coming, and there will be full electric Saabs by 2016.

In the near term, lack of inventory is a problem. In the U.S., it's only 500 to 600 cars but should be 5,000. This is because the plant produced nothing for seven weeks while in administration. Worldwide, Saab is short 15,000 to 20,000 cars. In the next two weeks, production will rise from 220 cars per day to 304, which is the maximum on a single shift.

Muller says that he expects Saab to turn a profit, and have positive cash flow, in 2012 with 120,000 to 125,000 sales on an 85,000 break-even, despite the plant's being configured for a capacity of 190,000 units under GM. The profit will be sufficient, he says, not only to pay for the new model program but also to repay the company's loans.

Inside Line says: Saab is reviving, and appears to have the resource to survive and, if Muller's predictions of profit within two years are correct, to flourish, too, even if traditional automaking theory says that profitability is not attainable at these volumes. — Richard Bremner, Correspondent