(June 13, 2011) Since getting an infusion of cash from Chinese auto distributor Pamg Da in May, Saab has encountered assembly line stops and starts in Trollhattan, Sweden.

Today, Saab announced that "the halt in production in April and May did not just affect Saab, but also our suppliers. We expected the risk of disruptions while restarting production, and have indeed experienced such 'hiccups' this week."

Therefore, Saab said in a press release today, that the company has decided to temporarily suspend production until it can secure a more stable flow of material.

"Yesterday, management reviewed the forecasted conditions for next week. This is part of the routine enabling us to inform suppliers about the production plan. The review revealed that suspended production will be necessary during next week as well," Saab reported.

"The dialogue with our suppliers continues with high priority."

Meanwhile, Saab has agreed to another Chinese firm, Zhejiang Youngman Lotus Automobile Co., taking an equity stake in the company as part of a distribution and manufacturing joint venture.

Saab and its owner Spyker Cars signed a deal with Chinese car distributor Pang Da in May worth up to 110 million euros that involved setting up a joint venture with Spyker and a partner in China to start making Saabs in China within two years.

Under the new deal, Youngman will take a 45 percent stake in the manufacturing joint venture in China, Saab 45 percent and Pang Da 10 percent. Youngman will also take a 33 percent stake in the distribution joint venture, with Pang Da holding 34 percent and Saab 33 percent.

Sources: Saab, Automotive News