Mike Stevens | Nov 8, 2011

Saab's agreement with China's Pang Da and Zhejiang Youngman has floundered this week after General Motors said it would not approve a sale if its own Chinese interests would be endangered.

The news follows an announcement last week that Saab owner Swedish Automobile had signed a memorandum of understanding with the two Chinese companies that could see the brand move to new owners.

The deal cannot happen without the approval of the European Investment Bank, which has loaned Saab money, and former owner General Motors, which retains preferential shares in the carmaker. GM is also a major supplier of components to Saab.

"GM would not be able to support a change in the ownership of Saab which could negatively impact GM's existing relationships in China or otherwise adversely affect GM's interests worldwide," GM spokesman Jim Cain said in a statement today.

Cain added that GM's original agreement with Swedish Automobile (Spyker at the time) cannot easily be transferred to new partners.

The American carmaker has not ruled out the potential for striking a new deal, however.

“As you can see in our statement, the issue of supplying components and power train and other things to Saab is something we’d be open to continuing under the right conditions," Cain told enthusiast website SaabsUnited.

Saab followed with its own statement today: "We acknowledge the position taken by General Motors, and will now discuss with Pang Da and Youngman to see whether a structure can be agreed which is acceptable to all parties concerned."

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