:spank:..I just HAAD to use Fark's headline of the story
http://www.bbc.co.uk/news/business-1388602423 June 2011 Last updated at 09:07 ET
When a company can't even afford to pay its employees, you know it's in big trouble. Staff wages are invariably the last thing to go before any company has to give up and call it a day. This is precisely the situation in which Swedish carmaker Saab finds itself, having already suspended production after failing to pay suppliers. The reason could not be simpler - Saab does not sell enough cars.
Under investment
It sold just 30,000 last year, with analysts suggesting it needs to sell 120,000 just to break even. No business can sustain such losses for long, let alone a relatively small company with very little cash in the bank. And here lies the problem. Under the ownership of US car giant General Motors (GM), Saab was able to sustain losses. Following the sale to Spyker, now called Swedish Automobile, it cannot. Under GM's stewardship, which lasted for 20 years, Saab suffered from chronic under-investment, analysts say.
It makes just two cars - the 9-3, the current model of which is a decade old and won't be replaced for another two years, and the 9-5, which was replaced 18 months ago after 12 years.
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