Saab Automobile terminates an agreement with China’s Hawtai Motor Group meant to secure medium-term funding for the cash-strapped Swedish auto maker, clouding its future once again.

U.S. Saab dealers witnessing the car company’s topsy-turvy fortunes in the last 18 months are keeping their spirits up in the face of the latest bad news.

“This is a company with the technology to bring great products to the market, but they’ve got to get their financial house in order,” says George Glassman of Glassman Saab in Southfield, MI, a seller of the iconic cars since 1981. “At the end of the day, we’re back at square one.”

Saab-parent Spyker Cars, which bough the auto maker from General Motors last year in a transaction valued at $400 million, says Hawtai could not “obtain all the necessary consents” of various stakeholders to seal the deal.

“The parties were forced to terminate the agreement with Saab Automobile and Spyker with immediate effect,” Saab says in a statement today. “The parties will continue their discussions about a possible cooperation.”

However, negotiations to secure short- and medium-term funding for Saab will no longer be exclusive to Hawtai. Saab now is in talks with other potential Chinese partners on equity and debt financing, or financial support combined with technology licensing.

Hawtai would have acquired up to 29.9% of Spyker for E120 million ($173 million), plus E30 million ($43 million) in the form of a convertible loan agreement.

Bernie Moreno, owner of Saab of North Olmsted outside of Cleveland, expects a positive resolution. “From my perspective, this is all part of the negotiation process,” he says.

Adds Moreno, who just opened a new $4 million Saab showroom: “It doesn’t worry me for a second. This is a complicated process, and I have full faith in (Spyker-owner) Victor Muller.”

Saab says it continues to work with the European Investment Bank to obtain access to the remaining E29 million ($41.6 million) in lending for the auto maker backed by the Swedish government and won shortly after breaking off from GM.

Gaining the rest of the EIB funding hinges on the sale of certain Saab property put up as collateral for the loan. The auto maker indicated last month it may not immediately find a buyer. The sale would reduce the EIB loan pledge from E400 million ($574 million) to E280 million ($402 million).

Once Saab can tap the remainder of its EIB funds, the auto maker plans to restart production at its Trollhattan, Sweden, assembly plant that has been down for weeks. However, the restart may require new payment agreements with key suppliers.

Saab recently landed a E30 million ($44 million) loan from a private-equity partner as short-term funding, and Russian banker Vladimir Antonov was cleared last month to join as an investor.

Earlier this year, Muller sold the company’s sports-car business to Antonov for a reported E15 million ($21.5 million) to focus fully on reviving Saab.

At the close of the first quarter, Spyker-Saab held E255.3 million ($366.2) in operating cash but could not make supplier payments, leading to the factory’s shutdown.

The new-for-’11 Saab 9-4X cross/utility vehicle developed while under GM’s wing went into production earlier this week at GM’s Ramos Arizpe, Mexico, assembly plant. A redesigned 9-3 sedan, Saab’s bread-and-butter vehicle, is due next year.

Earlier this week, Saab lured Timothy Colbeck away from thriving Subaru to run its North American operations. Colbeck told Ward’s in an earlier interview he expected a resolution soon to Saab’s financial impediments.

“I wouldn’t be here if I wasn’t confident,” he said at the time.

jamend@wardsauto.com