German Saabs – my 0.02c

The latest news, published at Just-Auto.com, says that the Opel factory in Russelsheim will begin producing it’s first Saabs in 2008. Whilst Autoblog are claiming that it’s possibly the final development that’ll send Saab diehards over the edge, those of you that have been following Saab’s fortunes over the last few years shouldn’t be surprised at all.

Around 18 months ago, General Motors made several factories bid for the right to produce Saab’s next generation 9-3 and 9-5 motor vehicles.

The Trollhattan plant was in the running, as was the Russelsheim plant. There’s a number of theories as to why the Russelsheim plant won the new job. Firstly, it’s much bigger and with a much bigger workforce. One theory is that GM wanted to avoid the consequences (i.e. worker/union backlash) of not awarding the production there. Another theory states that when GM benchmarked the two facilities, Russelsheim had shown a superior efficiency gain in recent times – which some have attributed to the fact that Trollhattan had made it’s efficiency gains years prior when GM tightened the purse strings. They had little more to clean up in comparison.

Of course, it may just be that Russelsheim was better equipped to handle the expected higher volumes of Epsilon II traffic.

Whatever the reason, the fact is that Saabs are going to be produced in Germany. I don’t like it any more than you do, but the wheels are in motion and in the absence of a targetted earthquake that causes no casualties but levels the Russelsheim plant there’s little we can do but lump it.

But that little we can do is, I believe, meaningful.

That little we can do is try to ensure that GM understand the importance of Trollhattan to Saab. I’ve never been there, but in 60 days or so I will be there, and I want to try and come to understand exactly what the city means to the company and vice versa. What its Swedish heritage means to Saab.

GM didn’t just buy a brand when it bought Saab, back in 2000. It bought a company with a very distinct heritage, an identifiable automotive soul and an educated (and opinionated) customer base. It bought a company that designed and built cars based on a deliberate notion of form following function. A company that punched well above it’s weight in terms of both innovation and execution. A company that’s contributing a hell of a lot of technology and know-how to GM’s current alternative fuel strategy.

GM need to understand that Saab belong in Sweden. And if one GM employee replies to me that they’ll be retaining a “brand centre” there then I’ll out that person for the spinmeister they are.

I can’t believe that GM wouldn’t have a handle on the damage that the 9-2x and 9-7x have done to Saab’s brand image in the United States. Both were fine vehicles, finished to differing standards of Saab-ness, but both have launched a tirade of ridicule in the automotive press that’ll take considerable time AND adherance to heritage to overcome. The 9-2x and 9-7x have brought some new customers to Saab showrooms and for that we should all be thankful. But the damage they did is also measurable.

If GM dismiss public forums and blogs as measures of public opinion then they do so at their own peril. Go to any recent post about Saab at Autoblog and you’ll see a stream of comments snarking about Saaburus and Trollblazers. Some of these people were never likely candidates to own a Saab anyway, but many people that read them quite possibly are.

The point of all this?

Yes, you can manufacture Saabs successfully in places other than Sweden. Saab themselves did it for years. Of the six Saabs I’ve owned over the years, three of them were manufactured outside Sweden. Saab’s iconic convertible is made in Austria and has been for a number of years. It can be done.

But the base has to be in Sweden. It’s a Swedish brand and this heritage, this point of difference is one of Saab’s strong points. How many successful motor vehicle companies no longer have a manufacturing presence in their home country?

Just-Auto’s business blog writer, David Leggett, makes a few good points:

BMW can make cars in the US because they are still blessed with BMW values and most BMWs are made in Germany. It has the brand strength to get away with that, but BMW knows that it’s a balancing act. Only a minority of cars will ever be made outside of Germany.

Chevrolet, on the other hand, is doing well for GM as a global value brand. Chevrolet customers – outside North America – look at the sticker price on what used to be a Daewoo and aren’t overly concerned about where the cars are made.

Chevrolets, in this sense, are a commodity product.

But a Saab isn’t and there’s just a danger that GM is sending the baby out with the bathwater in deciding to make most Saabs in Germany. The accountants may have good reasons for what has been decided, but if I were a manager at GM Europe, I’d be moving heaven and earth to reshuffle the deck so that Trollhattan will be making more Saabs than Russelsheim.

I wonder what Saab’s dealers make of it all and whether GM has listened to them?

In the next few years, GM will have to decide where Saab’s new, smaller vehicle will be made. The 9-3 and 9-5 are being moved to Germany and the upcoming 9-4x is strongly tipped to be produced in Mexico. The place of manufacture for the “9-1” will quite possibly determine whether or not GM can truthfully call Saab a Swedish brand anymore. There’s encouraging news on this front just this morning, with Jan-Ake Jonsson saying that it’s likely it will be built in Trollhattan, alongside a new generation Astra (thanks cj). I’d feel more certain about this if it were coming from Carl-Peter Forster as a definite decision, though.

Heaven help Saab if they get it wrong.

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19 Comments

  1. Swade, your going to have to ask some tough questions when you get there. I was there in 1998 and they do listen to what you have to say, just remember GM holds the bank book and the checking account so Saab can fight all they want in the end GM Detroit calls all the shots!

  2. I so completely agree with everything in this post to the extent that I’m wondering if it’s more opinion or fact.

    Seemingly since the decision to move 9-5 and subsequently 9-3 production to Germany GM and SAAB execs have been teasing with the “smaller SAAB” production possibly being in Trollhattan.

    However, now I’m reading that the latest round of cutbacks in GM Europe may see the outright shut-down of Trollhattan. As you mentioned GM has already sold the SAAB engine plant in Sweden which made the 9-5 engine (shame, as I was hoping the next-gen 9-3 might get a version of that engine).

    Even IF the “9-1” or “9-2” is to be made in Trollhattan, I’m sure production wouldn’t begin until around 2011. What do they build until then? How many more Cadillac BLS units does Europe really need? From everything I’ve read Trollhattan has been grossly underutilized for years and have a much greater capacity than even what they’ve been producing.

    What I’d like to hear is that later this year we’re to see a concept of a small SAAB roadster and they’ll go into production in Trollhattan in 2008! I don’t think that’s likely to happen though… 🙁

  3. I think David Legget’s comments are right on the money. If GM moves all Saab production out of Trollhattan, expect to see their supporting enthusiast community dry up and stick with their older saabs. That would be a death blow for sure. Even if they were even to product one car like the 9-1, it would still be a problem, GM needs to do more than that. They played chicken with their enthusiast base with the 9-2x and 9-7x, and they can’t afford to play a similar game again, it will be impossible to recoupe. That being said, I have no problem with some cars moving out of the country, just all – half would be OK. The quality of the austrian built convertible is top notch anyways.

  4. This one is a puzzle.

    Consider that Saab convertibles, to my knowledge, have never been made in Sweden (mine is Finnish), Saab 9000s have been assembled in Sweden, but many of the parts and much of the engineering and design were done elsewhere, the B20x engine is an evolution of an English design, and, of course, Swade is Australian. What exactly is made in Sweden?

    On the other hand, UrSaab, the 99 and 900 and much of the heritage is built in Sweden.

    So, then, the question becomes this: Saab certainly can built great Saabs elsewhere, but will they continue this in the future?

    I think so. My glass is half full. Why? Because this is the most logical way for Saab to survive. The small volume that Saab sells needs to have a high-volume manufacturing scale to help production costs to defray cost. They also need the flexibility to build what they want, and GM has let them do that in the past. Why wouldn’t it continue?

    My guess is that Saab’s lineup will grow a little, too.

  5. sethsev7n: the 9-3 verts manufactured in Austria are built by a company called Magna International, as I learned from a post at SAABCentral by SaabKen.

    If you go to their webpage, on the main page they have some Flash pictures and in one of them you can see the 9-3 manufacturing line.

    I wonder why GM would allow a subcontractor to build the car when their own plants are underutilized? I guess Magna’s bid for the 9-3 ‘vert production must’ve been lower than any of the other GM Europe plants (including Trollhattan)…

    I remember reading recently that Magna had bid on the Chrysler Group. According to the London Sunday Telegraph they were supposedly also on the “short list” to buy Aston Martin.

  6. I know this is going to be construed as being facetious, but after 2010 why doesn’t GM just change the name of SAAB to “GM Europe” or something? I mean, it’s really pretty silly to try and sell the cars as “SAABs” when no part of them is manufactured in Sweden anymore. Nor is SAAB in any way affiliated with Svenska Aeroplan A.B., despite what the “born from jets” commercials would lead one to believe.

    After 2010, what is really SAAB about SAABs anymore?

    I don’t know for sure, but I’m guessing fans of the classic Mini Cooper don’t consider the German-designed and built BMW Mini as a “real” Mini, do they? It’s just a brand name BMW bought and a theme they designed a new small car to. There’s not too much Mini tradition in the new Minis that I know of.

    eggsngrits: in your post you pointed out lots of things about SAABs that weren’t very SAABy (BTW, you forgot to point out that the V4 in the 96 was a Ford Europe design and that the two-stroke in the early SAABs was a German DKW), but you didn’t point out the fact that EVERYTHING ELSE was. You mention the UrSAAB, the 99, and the 900 but skip over everything in-between.

    While I recognize that GM has to do what it needs to do to make these cars profitably, I agree that they need to make at least half of SAAB vehicles in Sweden for there to be any kind of genuine link to the SAAB name and tradition. Otherwise, the word “SAAB” is more a Disneyesque theme than a real marque.

  7. Okay, let me make a correction before someone else points it out: the BMW Mini was designed by a guy who was born in Morocco (not sure of nationality though) and is manufactured in England. The guy who designed the Mini graduated from the same design school (Art Center College of Design in Pasadena, California) as the head of GM Europe (and designer of the PT Cruiser and Chevy HHR) Bryan Nesbitt.

    The Mini was designed by the Rover Group before BMW bought it. I really should do more research on these things before I post…

    But the point shifts then to the fact that the BMW Mini is more true to the Mini tradition than the 2009 SAAB 9-5 will be to the SAAB tradition, IMHO.

  8. The Mini thing’s been pretty interesting actually. Down here, the Mini Club had a big show and there were an astounding number of cars there (for a small place like Hobart). Around 500 Minis gathered, which even stunned the organisers. but there were both old and new Minis there. Both models seem to have been embraced pretty well.

    Two good things BMW did with Mini – styled it in a true modern interpretation of the original, and kept production in England.

  9. I don’t even want to start with how depressing this will be for me in 2008. Probably the saddest saab moment of my saab life.

    A couple of years ago when the 9-3ss just came out, the dealer told me ‘Saabs are becoming more and more like Opels, starting with the new 9-3’ and i thought ‘huh?’. But now, it all makes sense. Saabs are less and less Saabs. You guys know what i’m talking about. I think i’ll grab myself a 9k aero as they are going extinct before viggens are :)…

  10. all of this makes my blood simmer. the only thing holding back a boil is the fact that GM is keeping Saab alive.

    as a relative newcomer to Saab, i feel like i’ve arrived to the party a few hours late. GM made out with my girlfriend, drank all the beer, puked all over the place, and passed out in MY chair.

    ok, i’m boiling now.

  11. Hello everyone,
    I’ve been reading this blog for some months now. I used to own 9-5 wagon, but my current situation does not allow me to own SAAB. We have an agreement in place in our family, that we will get one again once the situation will be sorted out a bit again.
    Now to the topic, I personally do not like the idea of SAABs made in Germany, but it is still better than in China. I’m trying to be very realistic. Please look at Rover and MG. As long they will keep the R&D in Sweden it is OK.
    More in general, let’s face it, there is not too many people that would buy SAABs. Look who is winning elections? They were elected by majority. 🙂 GM is trying to find balance between profit and uniqueness. To me they are doing OK so far.
    Honestly I’m not a strong believer of SAAB expansion if GM would not … etc. For me SAAB is SAAB and it is good as it is not BMW or Audi. SAAB represents values that are not shareable with everybody who has money to buy luxury items. Let Lexus and others to saturate greed and please leave us SAAB. We will do our best to keep it alive with our attention.
    Short reply on Magna and convertible, Magna is, I believe, making convertibles pretty much for everybody. That includes R&D.
    I would like to thank Swade for keeping the site up. I was missing this kind of site for long years.
    Radovan
    Czech Republic

  12. First I must say it will be tough for Saab loyalists to look at at a Saab and think of it being made anywhere but Sweden. But times have changed and we all must change with it. Lets be honest with each other here Saab would be dead right now if it weren’t for GM. I am not happy about production going to Germany either, never the less lets not bury the dead until they have breathed there last breath. If the new 9-5 turns out to be a rocket ship with all the Swedish characteristics than hope is not lost. By the way someone stole my handle Saabboys are popping up everywhere now I must change it.
    It might be possible that the Germans could build a better car, one thing I noticed while I was in Sweden was how young the assemble line workers on the 9-3 line were. Kids mostly, take a good look at what you see swade and then take a trip to the Opel plant in K-Town (Kaiserslaugtern) I don’t think you will see much difference in the two. I am not ready to right off Saab just yet, nor should the pessimists that think the world is ending.

  13. I’ll put aside engines for a moment (DKW, Ford V4, Triumph, GM from Oz) ie what is a SAAB engine?

    3 of my cars (the 99 turbos) were made in Finland. The others were Swedish assembled. The 99T’s don’t feel any less SAABish to me than the other cars, but back then the same cars were being produced in both countries and isn’t Finland still scandanavia? If all the 99’s were produced in Finland I’d probably feel differently. SAAB 99 would be a Finnish car for me.

    Global reality is that cars are built all over the place, like German cars in South Africa and Japanese cars in Thailand etc. I don’t have a problem with that.

    But if I’m out there buying a Mitsubishi or Nissan I’m going to have different expectations than when I’m shopping for a BMW or SAAB.

    For my money, SAAB needs more than a design and development presence in its home country. Besides, if Sweden loses manufacturing entirely it must be only a matter of time before the other skills go too. BMW is a worthy adversary despite the fact that I don’t much like them, but would they for a moment consider shifting manufacture to Sweden? Like their succcess story the new Mini is not built in Germany. Their marketing people are too clever for that by far.

    As cars tend to morph into each other there must surely be an advantage in maintaining a point of difference in the market-place. I have no idea how many of us are out there who still love their 99’s and 900’s, and have the capacity to buy a new SAAB. One that hits the right notes. I’ll bet that it is quite a few though.

    If no SAAB is to be made in Trollhattan, the sense of heritage is lost for me and I’m lost to the brand (but no SW that doesn’t mean my 99T’s are for sale).

  14. I agree with Radovan and Saabboy1,

    1) I really don’t care where they are built. The 99’s built i Finland was true Saab to me. BMW are starting to build cars in India. Are they less BMW to the drivers that vill buy them? Don’t think so. What I do have a problem with is that not all development and design are made in Sweden.

    2) As pointed out before, what if Saab as it was five or ten or fifteen years ago never ever could attract more buyers then 120.000 a year in the whole world? As much as I love Saab, I rather have Saab’s that are a little less “Saab” and sell more and guarantee the brands survival, than some really hardcore Saab’s that only reach 80.000 and will either force GM to sell it to some Chinese company or turn it into a strange luxury car that none of us can afford to buy anymore.

    3) I wondered what all of us would have said in 1985 about the 9000. I think it would have been the same: it’s not a true Saab, this is the last nail in the coffin, this is the end, bring back the 99, and so on. I know that as a Swede, I thought it was a strange car and not Saab at all when was introduced. And still, 20 years later we praise it as a true Saab. Time changes, and Saab must change to keep up. There is no “true Saab timeline” that we can measure the current status against. It’s pure and pointless speculation. Saab as a brand is shaped every day and only exists in one form, and no one know if some other action yesterday would have been better or worse.

  15. I want my Saab to be more than just a Scandinavian design. I want it to be a Scandinavian product.
    I have decided long time ago that the only car manufactured in Germany that I’m interested in, is manufactured in Stuttgart.

  16. I guess I’ll be another odd one here, but here it goes. I don’t care where SAABs are built either. I care about them being great cars. GM has way too much capacity world wide. They have to shut plants. They are closing many plants here in the USA, and people are not happy either. The fact is GM needs to become more efficient, and one way is to build multiple models in the same plant. Honda and Toyota have been doing this for years. Ideally GM would be able to build cars everywhere they sell them, but the reality is that GM has to take a global perspective in order to survive. If Trollhattan can make cars profitably and efficiently then good. If not shut it down and find a plant that can. GM really does not have many options here, they are still in financial trouble, although improving. It’s either step up or get run over by the competition.

  17. Let’s be clear about this: GM has too much capacity in expensive, developed companies. And has too little capacity in cheaper, developing countries.

    They’re shutting down plants in the U.S. and western Europe, and building them in Mexico and China.

    BMW and Mercedes can still afford to build cars in Europe because their cars still command premium pricing. Saab cannot.

    If GM understood Saab, it would invest in the brand so as to permit the continuation of some Saab manufacturing in Trollhattan. That is, it would improve things so that premium pricing would support Saab’s continued fabrication at Trollhattan.

    But GM does not understand Saab, so it continues to make penny-wise, pound-foolish decisions about Saab that will result in the death of the brand.

  18. I wonder does David Leggett know that BMW has been building its core product in South Africa for many years?

    Does it matter where a SAAB is built? If the company has a strong brand and a competent management then the cars can be built anywhere. If the 9-1 is produced in Sweden alongside the next Astra then I think there is room to produce the 9-3 and 9-5 elsewhere. It would even make sense from a platform perspective. If they shut Sweden down then I think the company may fail.

    On thing I can say for sure is that whenever a new model is launched the diehards kick it to death when they realise that once again SAAB aint dusting down the tooling for the 900. Then as ctm says above, 20 years later it is seen as a classic. Look at the NG900.

    People are holding up the 9-5 as the last true SAAB when it runs on a Vectra chassis. I’ll bet it was seen as a sell out when it was launched.

  19. Lots of good comments. My two cents worth is that I will continue to buy Saabs as long as they have cars with the characteristics that attracted me to Saab in the first place. It doesn’t matter to me where they are built, or even where they are designed, just as long as they have the characteristics of a Saab that I have come to love. As for the factory in Trollhatten, it is up to the people there (management, workers, gov’t) to make it a good place to manufacture cars. The time is past when manufacturing plants didn’t have to worry about being competitive on a global scale. I just read an article about an Indian company, Tata, that plans to build cars for $2500. I’m sure they won’t be anywhere near as good as Saabs, but don’t you think that $2500 automobiles are sending shivers up the spine of auto manufacturers in high cost locales?

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