Jay Spenchian remarks at SOC

Following is a transcript of (Managing Director, Saab USA) Jay Spenchian’s address to the delegates at the Saab Owner’s Convention over the weekend. I’d like to thank Saab USA for allowing me to provide it here for the wider Saab community.

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“The State of Saab 2006”

It is again a privilege to be with you all here at the 2006 Saab Owner’s Convention. This year is extra special, as we are celebrating that Saab started its sales activities in the USA exactly 50 years ago.

Pictured is the kick-off at the 1956 New York auto show (picture here)….Boy – have we come a long way since then…

And here’s how we honored that at the New York auto show this year – with a special display that featured the very first Sonett, brought in from our Saab USA heritage collection.

It was just one of the many, many Saab initiatives that we have started, since we met last, just one year ago at Mount Stratton in Vermont. Then, as now, our focus is on four major areas:

First and foremost, the development of our product portfolio – a lot of that has happened just last year.

Second, the way we present ourselves in the market – our Born From Jets integrated marketing campaign comes to mind.

Third, the overall payoff: sales.

And last but not least, a look into Saab’s exciting future.

Starting with our product portfolio, the undisputed backbone of Saab’s current line-up is and remains clearly the 9-3. It is a highly capable contender in one of the hottest segments and still has potential for more growth.

This is best demonstrated by the sales of the 9-3 Sport Sedan here in the US, which were stronger this year so far than almost anywhere else in the world.

To keep the 9-3 in full flight, the key is to keep it fresh and vibrant with constant news and enhancements. An excellent example of that is the SportCombi, the third bodystyle in the 9-3 portfolio which we added this year – and with great success.

Right out of the chute, the SportCombi received tremendous press coverage – such as this one from Pulitzer winner and one of our toughest critics, Dan Neil in the very important Los Angeles Times. His head line: Saab hits a home run.

And here are some of the great accolades that we received just within the past months for the 9-3 SportCombi. Based on a jury of respected journalists and elite athletes, Active.com elected the SportCombi the Active Lifestyle Vehicle of the Year.

Edmunds.Com called it The Right Combi, SmartMoney Magazine the best SportWagon. It is The Manwgon according to the Wall Street Journal and the Top Sport Wagon according to Suite101.Com, who both drove the 9-3 SportCombi back-to-back with the latest wagons from Mercedes, Audi and BMW.

The New York Times gave us a big headline: “Thank You Saab – May I Have Another?” And just this week, ForbesAutos.com named the 9-3 SportCombi the Best Saab Ever.

And the great thing is that all these accolades also start to translate into success in the marketplace. Starting from zero, the 9-3 SportCombi now occupies almost a quarter of the entry luxury wagon segment – second only to Volvo, which has been known as the quintessential wagon brand for ages.

Speaking of accolades, here’s another one that bears great significance among people who know about automobiles. Our all-new 2.8 V6 Turbo, which we also launched in the 9-3 Aero this year, was voted one of ’10 Best Engines’ by the editorial staff of Ward’s Automotive.

This new 250 hp V-6 Turbo is now available in the entire 9-3 family, as the Aero versions of the 9-3 SportCombi, the Sport Sedan and Convertible.

With the arrival of the new engine, we have also created the opportunity for every customer of a new 9-3 Aero V6 to participate in the Saab Aero Academy driver’s education course at Road Atlanta, Georgia – a 1,350 dollar value.

While this great experience previously was only available to buyers of a 9-5 Aero, it now also comes standard with every 9-3 Aero as well.

The new Aero V6 is also the base for this highly desirable, limited edition Convertible. With its special Electric blue color, matching interior and unique ‘double spoke’ 17-inch wheels, this is a guaranteed collector car that will be a hit at Saab Owners Conventions for many years to come.

This limited edition celebrates the 20-Year anniversary of the Saab Convertible. Over three generations, we have now sold over 250,000 Saab Convertibles worldwide since 1986 with the 900 that immediately attained classic status.

For 2007, the big news in the entire 9-3 range is that we are introducing a completely new instrument panel. I’m sure many of you will welcome the inspiration by the lines of the classic Saab 900. At the same time it has a much simpler look and buttons and knobs are easier to operate.

The 2.0T base engine with 210 hp now comes standard with a 6-speed manual transmission. The Aero models get standard XM radio, and the Aero sedan gets Bose audio.

Also, the available NAV system gets voice control. It has a larger touch screen that also shows street names.

Switching gears now to the Saab 9-5. Also here, a lot has happened since we met last year. First off, the exterior was significantly refreshed this spring – taking its cues from the 9-X concept car from a few years ago.

The 5-door version is also taking on the SportCombi name, which we’re now spreading across the board – just like Audi with their Avant and BMW with the Touring version.

The SportCombi has a new tailgate and rear fascia. The wider track contributes to the bolder stance.

The new 9-5 interior has been freshened with new upscale materials. Many details have been inspired by the sporty cockpit of the 9-3 Aero. And, it is one of the few cars in the segment that can still be purchased with either a manual, or a manumatic transmission.

The Saab 9-5 remains a very relevant car that keeps getting important accolades. This year again, it was named a ‘Recommended Buy’ by the editors of Consumer Reports here in the US. And Folksam, the independent Swedish insurance institute, concluded that the 9-5 stays on top on the list of safest cars on Swedish roads.

For 2007, the Aero package returns in the Saab 9-5. It includes sport suspension and sport seats, for just $1,095 – plus access to the Saab Aero academy, which just by itself is a $1,350 value.

Next up is the Saab 9-7X SUV. As you can see, this 9-7X finally gives you as Saab enthusiasts the opportunity to transport your classic in style!

The 9-7X continues to develop itself well in the North American marketplace. Having started from scratch, we are selling on average 500 per month. There are now over 6,000 on American roads – which is fully in line with our expectations.

After its launch last fall, the major news for the 9-7X is the introduction of standard ‘Turn by Turn’ navigation as part of the Onstar package.

Other exciting news for the start of the model year is the 9-7X Altitude Edition. This limited edition 9-7X includes attractive extras, such as running boards, polished 18-inch wheels and a special premium metallic gray color.

Wrapping up our product portfolio, there’s very good news on the pricing front. Saabs will remain an excellent value, as prices for 2007 are very similar to the previous year. For the 9-3, we will still start under $27,000 for the well-rounded 2.0T sedan, including destination charges. This means that all the updates for the new model year come at almost carryover prices.

The very well equipped Saab 9-5 2.3T still starts under $35,000. This means a $9,000 difference with a comparably equipped Audi A6.

The 9-7X pricing continues to begin under $40,000 for the six-cylinder, and under $42,000 for the 9-7X V8. This means a price advantage of about $8,000 with a comparably equipped Volvo XC90.

And talking about value – in this day and age of high fuel prices, Saabs continue to be known for their excellent fuel economy. For the 2007 model year, we have no less than 7 model variants in the 9-3 and 9-5 range that have a certified EPA highway mileage of 30 miles per gallon. Some of our customers report that they do even better than that in day-to-day reality!

Now, with such a great product portfolio, what is Saab doing to bring that to people’s attention? I’m happy and proud to report that we have re-found inspiration in our rich aircraft heritage.

As you are well aware, Saab’s automobile activities were originally founded by 16 aircraft engineers. Well, their spirit lives on…

Just to give you some background on our new advertising, here are some of the goals behind it. First of all, we want to increase customer awareness and some key measures that drive consideration in the premium segment.

These are connotations like Fun to Drive, Excellent Handling, Technologically Advanced, Proud to Own and Distinctive.

Research told us that Saab’s aircraft heritage is very engaging. It efficiently communicates an idea that’s much broader than just performance.

It hints just as well at progressive design, sporty drive, emotional functionality and safety – exactly the Saab ‘brand pillars’ that support the Saab brand.

Furthermore, our aircraft background is unique in the industry. It answers the question: “Why Saab?” and explains in many respects why Saabs are different from most other vehicles.

Obviously, it drives tons of creative inspiration: “Why drive a car when you can fly a Saab?”

Research yielded the ‘Born from Jets’ tagline of a fully integrated campaign, using the statement “Once you’ve built jets, you don’t just build another car”.

What you are seeing in magazine print advertising is a clear, aircraft-inspired focus on our newest products like the new Saab 9-5, as it has now become fully available at dealerships.

And now, I’d like to show you a couple of the TV commercials that we are running as part of the ‘Born From Jets’ campaign

(Show “Delta Formation” 9-3 Convertible, “Transformer” 9-7X, “Head to head” 9-5)

Another initiative that we’ve undertaken is the “Born From Jets Tour”, visiting popular air shows throughout the nation. These shows are typically attended by hundreds of thousands of people, giving Saab the exposure we need in a very brand-related environment.

Here is a short video that gives you a flavor of that. (Show BFJ Tour video).

Here are the dates where you can see the Born From Jets at an air show if you are in the area: Cleveland Ohio over the Labor Day weekend next week, Reno Nevada September 13-17, San Francisco California on October 7-8, Houston Texas on November 4-5 and Las Vegas Nevada on November 11-12.

Now, what are the results of the Born From Jets campaign, since the start last fall? Research clearly indicates that it is working. As you can see, Born From Jets has yielded tremendous improvements related to topic like “makes you more interested in the vehicle”, “makes you want to drive the car”, “stands out from other vehicle ads” and “makes you feel differently about the brand”.

In a short period of time, Born From Jets has become one of the best recognized slogans in the car industry here in the US.

All in all, we have undertaken many initiatives since we last met to support the Saab franchise and the Saab brand. Now, let’s take a look at the bottom line: our progress in terms of sales.

Just like last year, we remain Saab’s single biggest market. So far in 2006, July was our best sales month and August is shaping up pretty decently as well. Our Saab market share from month to month is up in the overall luxury segment.

And last but not least, despite the brutal competition that is unlike anywhere else in the world, we are on track to equal, or better our sales results from last year, which was just under 40,000 vehicles.

Nevertheless, our July sales were the best so far in 2006. With a much more even pace than last year, when a few months of record sales were followed by a very sluggish fall, we are now on track to equal, or better our 2005 sales results.

Worldwide, I’m happy to report that the Saab sales picture for 2006 looks even more encouraging. We’re up 11% in all markets combined, which is an all-time record. Much of that is taking place in Europe, where sales have increased a record 24% over the first half – mainly thanks to the very well received 9-3 SportCombi, diesel and 9-5 BioPower.

Talking about BioPower, we think that this also might be a great opportunity here in the United States as the availability of Ethanol will be expanding. As mantioned, we are selling this vehicle already in Saab’s homeland Sweden, and it has received a great reception there.

Ethanol is a renewable resource. It is an excellent fit with the Saab brand and our turbocharging technology. So it might be a logical step to also add BioPower to the Saab portfolio in the US in the near future.

At the same time, we are working on a whole new generation of future vehicles. Want a first taste of how those will look like? Well, look no further than the Saab Aero X concept car….

I was fortunate to be at the Geneva Auto Show last February for the world debut, and witnessed firsthand how the Aero X brought the house down. It was the focus of the entire General Motors media program at the eve of the show, and the meaning of that was widely noticed.

And the Aero X has been extremely successful for us in getting the attention that it deserves. First, in Geneva, it won the ‘Best in Show Award’ from AutoWeek magazine, which is highly regarded by car enthusiasts.

In April, the US premiere took place in New York with a party that attracted a host of celebrities and paperazzi. It made the Aero X the talk of Manhattan…

Then, just last week, the Aero X was invited to attend the extremely high-brow Concours d’Eelegance in Pebble Beach, California. This is without a doubt THE world’s premier automotive event when it comes to showing the classics of the past and the future.

Suffice to say that the Aero X was entirely at home among the best of the best car brands, including Ferrari, Bentley and Maybach.

Bottom line: in its short life, the Aero X has become a true superstar, with the most and best media reception in the entire Saab history.

And that bodes well for the future, as you will see the Aero X lineage clearly in future Saabs: not just its design language, but especially its bold attitude. You will see that figure prominently in the next generations of 9-3 and 9-5 that we are currently working on.

Furthermore, we are developing entirely new additions to the Saab portfolio. A good example is the Saab ‘Premium Crossover’ for market introduction in the near future. Just in case you wondered: this vehicle will be clearly recognizable as a Saab in every aspect.

But so much for the long term. Let’s keep a keen eye on the near future, which gives us plenty to do.

Next year, we will celebrate 60 years of Saab’s automotive business – so that means a great opportunity to celebrate our heritage, which is unique in the industry.

If not before, I look forward seeing you then.

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5 Comments

  1. Nice to have Jay at SOC.

    Notice the little white elephant (9-2X) not mentioned.

    I wish he hinted more at the upcoming CUVs (9-4X, 9-6X or 9-7X) and the rumored Sonett and 9-2X replacements.

  2. At least Jay said “diesel” once. An hour or so later I had the opportunity to bend his ear a bit. One thing I remember was “diesel VW owners willing to sacrifice testes for a SaabD” and how good that adcam would never be. The roundtable next morning was good too. Great hangin with all the peeps for a while.

  3. At least Jay said “diesel” once. An hour or so later I had the opportunity to bend his ear a bit. One thing I remember was “diesel VW owners willing to sacrifice testes for a SaabD” and how good that adcam would never be. The roundtable next morning was good too. Great hangin with all the peeps for a while.

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