Trollhättan, Sweden – Saab has received approval for its proposal for voluntary reorganization, following an appeal after it was initially turned down. The company said that it has subsequently launched an efficiency improvement initiative to become more cost-effective.
The voluntary reorganization process is intended to secure short-term stability while simultaneously attracting additional funding. The company is still waiting for equity contributions from Chinese partners Pang Da and Youngman. Saab said it will also request that bankruptcy filings by labour unions IF Metall, Unionen and Ledarna be cancelled.
The efficiency improvement initiative is part of a broader review of the company’s business plan for 2012 and beyond, and is aimed at creating a more flexible and more competitive cost structure for the company. Saab said the initiative also reflects the effects of the prolonged production stoppage since April 2011, and is an important part of the voluntary reorganization plan that will be presented at an upcoming creditors’ meeting.
During the coming weeks, Saab will identify areas throughout the organization where efficiencies can be gained, including both fixed and variable costs. These include eliminating duplication of work, streamlining processes, shortening lead times, improving coordination between departments, and simplifying the organizational structure. The company said that reducing the number of employees “cannot be ruled out.”
