Welcome to the deep dive everybody. I'm your
host and I'm super excited to get into our source
material today And I am your expert for today
thrilled to be here So we are jumping right into
something that I think is gonna really surprise
a lot of you listening like if I were to tell
you about a Well, a $63 .7 billion Krona Aerospace
and Defense Behemoth. Right. A massive, massive
company. Exactly. A company that's currently
building, like, AI -enabled drone swarms and
these highly advanced multi -role fighter jets
and literally radar -evading submarines. You'd
probably picture some shadowy, hyper -modern
tech corporation. Oh, totally. You'd picture
something out of a sci -fi movie. Yeah. But what
if I told you that this exact same company is
the one that built that quirky, highly distinctive
Swedish sedan that your favorite college professor
with the elbow patches probably drove back in
the 1990s? The one with the weird ignition. Yes.
The ignition is weirdly placed way down by the
gear shift. The dashboard looks suspiciously
like an airplane cockpit. We are, of course,
talking about Saab. It really is. the ultimate
corporate hidden identity, isn't it? The gap
between the general public's perception of this
brand and their actual, like, operational reality
today is just... staggering. It's completely
wild because people neatly categorize them in
their minds as this nostalgic vintage European
auto manufacturer. But that cozy memory completely
obscures the fact that we are actually looking
at a massive global military powerhouse. OK,
let's unpack this because our mission for this
deep dive today is to explore the fascinating
and frankly completely unexpected evolution of
Saab AB relying purely on their own historical
records and sources. Right. We're going to uncover
how a company that that was basically born out
of desperate World War II military necessity
constantly reinvented itself. I mean, accidentally
making iconic cars and pioneering commercial
computers along the way. Just as like side quests.
Exactly, side quests. Just to survive and remain
a technology juggernaut today. Which requires
us to look at how severe geopolitical pressure
forces a very, very specific type of innovation.
To really understand the DNA of this company,
we have to rewind to a place called Trollhetten
in Sweden. OK. This is back in 1937. Right. The
origin story. So we start with this engineering
company called Enohabe. And specifically, we're
looking at their aero -engine division, which
gets scooped up by a major industrial player
named Bowforce. And they create SAB. S -A -A
-B. Svenska, Aeroplan, Ektibolaget. But like,
Bofors wasn't just casually diversifying their
portfolio here, were they? No, not at all. They
had a highly aggressive, almost monopolistic
goal in mind from day one. They wanted total
control. Wow. Bofors had already been working
really closely with the Swedish Air Force on
weaponry, and they saw this golden opportunity
to create an aircraft manufacturer that could
lock down every single future aircraft order
for the Swedish military. They just wanted the
whole pie. Exactly. They wanted to be the sole
provider for an entire nation's aerial defense.
That is a wildly ambitious play, but they immediately
ran into a brick wall, right? Because the playing
field wasn't empty. No, there was serious competition.
Yeah, there was another Swedish company called
ASJA over in Linköping, and they were already
a dominant force. ASJA had even managed to poach
a legendary aviation designer, Sven Blomberg.
Right. The guy who was famous for designing the
Jack Falken fighter plane. Right. So Bofors realized
they couldn't just crush ASJA, so they tried
to absorb them. They attempted to broker this
parent company consortium in 1937 to merge the
operations. They even went so far as to buy out
a smaller third party competitor named Sparman
just purely to clear the board and force a duopoly.
It's essentially a 1930s shotgun wedding. between
two rival tech startups. And the military is
standing there holding the shotgun. That is exactly
what it was. But this initial consortium is incredibly
messy. They're clashing. ASJA is still winning
the standalone contracts. And it looks like the
whole thing might just completely fall apart.
But then the ultimate catalyst hits. The spark
that forces Sweden to completely change its strategy.
the Saversky P -35 crisis. Well, this part is
crazy. What's fascinating here is how isolation
accelerates self -reliance. At this point, the
Swedish government had ordered a fleet of Saversky
P -35 military aircraft from the United States.
So they were relying on an overseas partner for
their national security. Exactly. But as World
War II begins to escalate globally, the U .S.
government suddenly steps in and just halts the
delivery. The U .S. basically tells Sweden, sorry,
we need all of our domestic manufacturing power
to build tanks for our own war effort. You're
on your own. Yeah. And for Sweden, that isn't
just an administrative headache. Oh, no, it was
an existential threat. I mean, Sweden was officially
a neutral country. But look at a map from 1939.
They were entirely surrounded by a rapidly expanding,
highly destructive global conflict. So when that
American supply line vanished overnight, the
Swedish government had a terrifying realization.
You cannot outsource your own survival. Wow.
Yeah, if they were going to defend their airspace,
they had to figure out how to build the planes
themselves. From scratch. Immediately. That sheer
desperation forces the issue. ASJA and the Trollhet
and SAVE operations are formally like tightly
merged into the SAB concern in 1939. With Link
Upping becoming the headquarters. Right. And
because their backs are completely against the
wall, they just start cranking out innovations
at a breakneck pace. I mean, they build the SAB
17 light dive bomber in 1940. They build the
SAB 18 Schnell bomber in 1942. But the aircraft
and the source material that absolutely blew
my mind is the SAB 21 single seat fighter. which
first flew in 1943. Oh, the SAB -21 is a master
class in solving bizarre engineering problems.
It was designed as a twin boom pusher propeller
aircraft. Which, for anyone who is an aviation
mechanic, means the plane looks backward. Yeah,
pretty much. Instead of the engine sitting in
the nose of the plane, like pulling it through
the air, the engine and the propeller are mounted
in the very back of the fuselage, pushing the
plane forward. Right. But that unique design
created a horrifying safety issue. The bailout
problem. Exactly. In a traditional fighter plane
from that era, if the plane takes damage, the
pilot opens the canopy and jumps out. But in
a pusher propeller aircraft, if the pilot jumps
out... The slub stream will pull them directly
back into those massive spinning propeller blades.
Yeah, it's basically a giant flying meat blender
right behind your head. That is terrifying. Ugh.
So Sobs engineers realize they have to invent
a way to get the pilot up and over that rear
propeller in a fraction of a second. They need
an ejection seat. And the Germans were also developing
early ejection seats at this time, but they were
using compressed air systems to launch the pilot.
OK. The engineers at Saab, however, took a much
more aggressive route. They decided to use gunpowder.
Yes. They literally designed a system that would
detonate an explosive charge directly beneath
the pilot seat, blasting them out of the cockpit
with enough force to clear the rear blades entirely.
I cannot imagine. being the test pilot who had
to volunteer to sit on a controlled explosive.
Like, no thank you. Right. But it perfectly encapsulates
the culture Saab was building. They were isolated.
They were under extreme pressure. So they engineered
solutions that were pragmatic, highly effective,
and entirely homegrown. Which creates a fascinating
dilemma because you have this intense, war -driven
company that has mastered complex metallurgy,
aerodynamics, and high -stakes engineering. And
then... The war ends. Yeah. The geopolitical
pressure cooker suddenly depressurizes the massive
blank check military contracts that fueled their
growth just dry up overnight. So how does an
aerospace engineer who just spent five years
designing gunpowder ejection seats walk into
work on a Monday morning and decide to build
a civilian car? It's a huge shift. It feels like
a massive leap. Well, it wasn't a passion project.
I'll tell you that. It was a desperate pivot
to avoid bankruptcy. Oh, really? Yeah. Saab had
this incredible roster of highly skilled aerospace
space engineers and massive factory infrastructure.
But their primary customer, the military, was
downscaling. They needed a new market immediately.
And as it turned out, the civilian world had
a massive gaping hole in its supply chain. Because
of the exact same dynamic that caused the airplane
crisis earlier. Right. The U .S. and European
auto manufacturers had spent the late 1930s and
1940s building tanks, Jeeps and munitions instead
of private cars. Exactly that. So when the war
finally ended, the U .S. domestic market greedily
absorbed whatever limited car production American
factories could muster. So Europe is left with
nothing. Europe, and specifically Sweden, was
left in a total vacuum. There were virtually
no new private cars available. Buyers were sitting
on waiting lists that were literally years long.
Wow. So Saab looked at that demand and realized
they had the tools to fill it. But the friction
of that pivot must have been immense. I mean,
these guys didn't know the first thing about
civilian automotive supply chains. No, not at
all. But they knew how to shape lightweight metal.
and they understood aerodynamics better than
almost anyone else in the world. So they built
a prototype called the ERSAB. And if you look
at photos of the ERSAB, it makes perfect sense
why it looks so strange. It's so weird looking.
It essentially looks like a wing without wheels
or like a metal teardrop. They didn't design
it to look stylish. They designed it using the
exact same aerodynamic drag coefficient principles
they used to make bomber planes fly through the
air with minimal resistance. Which makes sense.
And that prototype eventually leads to the full
-scale production of the Saab 92 automobile in
December 1949. Which explains why, for the next
50 years, Saab cars always retained that distinct,
slightly bulbous, highly aerodynamic shape. They
were literally born in a wind tunnel. Exactly.
But the cars are just one civilian side quest.
because the sources reveal an even wilder pivot
in the late 1950s. Saab decides to venture into
the commercial computer market with a division
called Data Saab. Yes, Data Saab. And I have
to admit I was completely lost reading this part.
I can understand an airplane company bending
metal to make a car. But why is an aviation firm
in the 1950s building banking computers for European
countries? If we connect this to the bigger picture,
you start to see Saab's aerospace division functioning
as a stealth incubator for all kinds of civilian
technology. They didn't launch Data Saab because
they wanted to compete with IBM. They built computers
because they had an extremely complex aerospace
problem that the open market simply could not
solve for them. The navigation equipment. That's
the core of it. As the Cold War escalated, fighter
jets became exponentially faster and their missions
became infinitely more complex. Right, they're
going supersonic now. Exactly. A human pilot
could no longer calculate navigation, radar tracking,
and weapons targeting manually at those speeds.
They needed an onboard computer to process that
data. But in the late 1950s, a computer wasn't
something you held in your hand. No, it was a
machine powered by massive vacuum tubes that
literally filled an entire climate -controlled
room. You obviously cannot fit a room -sized
machine into the cramped cockpit of a fighter
jet. No, you definitely cannot. So Saab is sitting
there realizing that if they want their next
generation of planes to actually work, they have
to invent a way to shrink a room -sized brain
down to the size of a suitcase. Which forces
a massive leap in miniaturization. They pour
resources into developing solid -state electronics
and compact microprocessors. And they pulled
it off. They did. This immense effort eventually
results in the CK -37 aircraft computer, which
becomes the digital heart of their famous Viggen
fighter jet in 1971. So they successfully shrink
the computer to fit in the plane. But, because
they spent millions of krona developing this
baseline computing technology just to make their
planes fly, some executive at Saab must have
realized, wait a minute, if our computer is powerful
enough to track a supersonic missile? It's definitely
powerful enough to process a civilian bank transaction.
Exactly. It is one of the clearest examples of
military research and development spilling directly
into the civilian sector. They commercialized
the tech they were forced to invent, selling
these robust, highly advanced data sob systems
to banks and businesses across Europe. But here
is the fascinating twist in this whole narrative.
Yeah. They didn't keep these civilian divisions.
Sob didn't become a massive conglomerate, making
everything from sedans to laptops. No, they didn't.
They slowly shed that skin. They sold off the
commercial computer division to Sperry Univac
in 1975. And the car division, the one the entire
global public associated them with, was gradually
sold off to General Motors. GM bought 51 % in
1990 and took complete ownership by the year
2000. Which leaves Saab AB stripped entirely
back down to its absolute core without the distraction
of marketing consumer sedans or servicing bank
computers. They refocused every ounce of their
engineering talent and capital back into aerospace
and defense. And we really need to look at what
that hyper focused defense juggernaut looks like
today because the scale is just incredible. As
of 2024, they are pulling in over $63 billion
in revenue. That's a massive number. How did
they achieve that kind of stability after shedding
their most famous public -facing products? Well,
a major, often overlooked factor is their financial
architecture. Saab is firmly backed by the Wallenberg
family. OK, who are they? They are one of the
most powerful industrial families in Europe,
and they control 47 .7 % of Saab's voting rights
through their investment firm. investor AB. Why
does that matter so much though? Because the
defense industry operates on timelines that most
normal companies just can't survive. Developing
a new fighter jet takes decades. Right. If you
are a standard publicly traded company obsessed
with making your shareholders happy every single
quarter, you can't weather those long development
cycles. Exactly. The Wallenberg backing gives
Saab the luxury of patience. It allows them to
plan for the security needs of the next 20 years,
rather than just worrying about the next earnings
call. And when you look at the hardware they're
producing with that long term vision, it goes
way beyond planes. Oh, absolutely. I mean, yes,
they have this legendary lineage of fighter jets,
the Tonnen, the Lanson, the Drakken, the Viggen.
Today, they build the JAS -39 Gripen multi -role
fighter. with over 300 of them built by 2020.
And they even partnered with American aerospace
giant Boeing to develop the T7 Red Hawk Advanced
Trainer. But they aren't just an airplane company
anymore. No, they've organized themselves into
highly specialized business areas like aeronautics,
dynamics, and surveillance. They have effectively
become a one -stop shop for an entire nation's
defense infrastructure. It's unbelievable. They
build the Carl Gustav portable anti -tank weapon.
They build the saber -toothed, unmanned underwater
vehicle. They had an entire shipyard division,
Saab Cockums, that manufactures actual stealth
submarines. Now I want to zoom in on one specific
piece of their surveillance and stealth portfolio
because it genuinely sounds like science fiction
to me. Oh, the camouflage. Yes, they have a facility
in Lillington, North Carolina, Saab Barracuda,
LLC. and they manufacture something called the
ultra -lightweight camouflage net system, or
ULcans. They won a competed $1 .76 billion contract
supplying this to the U .S. military. When I
first read camouflage net, I just pictured like
a heavy canvas tarp painted with green and brown
splotches. Which is how most people understand
camouflage, right? Fooling the human eye. But
visual detection is the least of your worries
on a modern battlefield. ULcans provides what
is called multispectral protection. Okay, what
does that actually mean for a soldier on the
ground trying to hide a tank? Well... An enemy
drone or satellite isn't just looking with a
regular camera. They are using thermal imaging
to look for the massive heat signature of a tank's
engine. Right. They are sweeping the area with
broadband radar, bouncing radio waves off the
metal hull of the vehicle to pinpoint its location.
If you throw a painted canvas tarp over a tank,
the radar waves pass right through the canvas,
hit the metal, and bounce back to the enemy screen.
So they see right through the disguise. Exactly.
But the ULCAN's material actively disrupts those
signals. It physically blocks and dissipates
the thermal radiation so the tank doesn't glow
on an infrared screen. That's wild. And it contains
specialized materials that scatter and absorb
specific frequencies of broadband radar so the
radio waves don't bounce back to the enemy receiver.
It essentially creates a localized black hole.
in the enemy's sensor network. Yes, it's not
just hiding. It is active electronic deception.
Okay, but here's where it gets really interesting,
though. We just talked about submarines, supersonic
jets, anti -tank weapons, and radar -absorbing
materials. Heavy stuff. Exactly. That is all
heavy, highly complex physical hardware. metal
explosives thrust. But you look at Saab's major
acquisitions in 2023, and they seem to be entirely
abandoning that physical realm. Ah, you're talking
about their aggressive move into the software
space. Right. In 2023, Saab acquires a UK based
company called Blue Bear. which specializes in
AI enabled autonomous form systems. Basically
teaching dozens of drones how to fly and attack
together without a human steering them. Right.
And literally a month later, they buy Crowd AI,
an artificial intelligence and machine learning
company based out of San Francisco. I mean, I
have to push back on this. You have an 80 year
old Swedish company famous for bending metal
and building fighter jets, suddenly buying up
Silicon Valley tech startup. It's quite a contrast.
It feels like a massive cultural and operational
clash. Are they even a hardware company anymore?
This raises an important question about the fundamental
nature of where global conflict is heading. For
the entirety of the 20th century, military dominance
was defined by the physical vehicle. The hardware
was the product. Exactly. Who had the jet that
could fly the highest? Who had the submarine
with the thickest hull? The biggest muscle. Precisely.
But Saab's 2023 acquisitions demonstrate a profound
realization that the era of hardware dominance
is ending. The physical jet, or the drone, is
now just the delivery mechanism. It's just the
muscle. Right. The true advantage in a modern
conflict lies entirely in the nervous system
controlling that muscle. So if the Gripenjet
is the fist, Crowd AI and Blue Bear are the frontal
lobe. That is a perfect way to look at it. They
aren't just building the fist anymore. They're
building the brain that decides when, where,
and how to punch. Processing thousands of variables
a second. Faster than a human pilot ever could.
By buying up Silicon Valley machine learning
companies, Saab is acknowledging that whoever
writes the best algorithms will ultimately control
the airspace. So what does this all mean, bringing
this back to you listening right now? Why should
you care about the 80 -year corporate history
of a Swedish defense contractor? It's a fair
question. Because Saab's journey is honestly
the ultimate masterclass in adaptability and
survival. It shows that the true secret to longevity
in any industry isn't just about what you're
building today. It's about your willingness to
constantly shed your own skin. They never let
nostalgia for their past successes trap them
into obsolescence. They dropped the consumer
cars the moment that industry no longer served
their core mission. They abandoned commercial
computers. They didn't cling to their identity
as an auto manufacturer just because the public
loved their quirky sedans. They just kept relentlessly
solving the next impossible problem in front
of them. From figuring out how to blast a pilot
out of a plane with gunpowder because they couldn't
buy American tech, to shaping a car like an airplane
wing, to realizing that the future of their hardware
company is actually borderless software. And
as defense companies like Saab move deeper into
artificial intelligence, machine learning, and
autonomous drone swarms, it forces us to reconsider
everything we know about global security. How
so? It leaves us with a heavy thought. In a future
where the most critical military technology is
no longer physical steel forged in a local factory,
but rather borderless code and algorithms living
on servers, will the historical concept of a
strictly national defense industry even make
sense anymore? Wow. That is an incredibly provocative
thought to leave on. Thank you so much for joining
us on this deep dive into the sources. The next
time you are walking down the street and you
see one of those quirky vintage Swedish sedans
roll past you, just remember its younger sibling
is currently a radar evading machine learning
drone swarm. Catch you next time.