Kill Saab?? Screw You!

Screw you, Alex Taylor III.

While we’re here, screw you Alex Taylor II and Alex Taylor I as well!! And what’s with the “III” business, anyway. Don’t you know that apart from The Godfather II, Rocky II and The Empire Stikes Back there’s never been a sequel as good as the original?

Alex-the-third thinks GM should dump Saab. Not sell it or invest in it but just kill it. He thinks that GM have too many brands (which may be so) and that the excess need to be vaporised.

With its perpetually tiny volume and high-cost European manufacturing base, Saab has defied GM’s efforts for nearly two decades to make it consistently profitable. The success of Japanese sport-luxury brands Infiniti and Acura has made Saab irrelevant.

A guy writing for “Fortune” touting a multi-billion dollar brand-and-customer-shedding exercise for a company reasonably close to bankruptcy and nowhere near equipped to take on Toyota with just the brands he want to keep?

He should be writing for “Trailer” magazine.

Saab certainly did shoot themselves in the foot with some over-investment in technology that was too specific back in the late 90s and early Naughtys. But a general lack of investment by the corporate parent in years past has left Saab with an underdone range. “Saab have defied GM’s efforts?” What efforts? Prior to the last couple of years Saab were left to play on their own with little interest whatsoever from the mothership.

When that range issue gets sorted out in the next few years the customers GM have with Saab will be pure gravy over GM’s normal demographic and the expanded range will see sales growth beyond what a lot of people believe Saab are capable of.

Book it.

Saab are capable of doing so much more if they’re given the right level of investment. They have a great niche position and (I’ll keep saying this until I’m blue in the face) are the best positioned brand that GM have got to take on the Europeans on their own soil.

Ditch the money pouring into Cadillac for Europe. Invest it in Saab and get that expanded model range out in Europe – pronto – if only so I can print this blog post, roll it up with a thin coat of oil and shove it up Alex Taylor III’s……

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20 Comments

  1. Don’t worry, Swade. If Kirk Kervorkian (or whatever his name is) and Jerry York couldn’t convince GM to kill SAAB, some clown from Fortune Magazine isn’t going to have any kind of say.

    The guy mentions Acura and Infiniti as making SAAB irrelevant, but does he realize that those two brands are not even sold in some of SAAB’s markets?

    This guy is obviously U.S.-centric and doesn’t know what he’s talking about.

    If GM should kill off a brand or two maybe they could start with one of the seemingly dozens in the U.S. (Buick, Chevrolet, Pontiac, Saturn, GMC, HUMMER, Cadillac, or Oldsmobile. Oh, that’s right, I forgot about that last one. I would start with Buick or maybe Saturn. Or Pontiac. Or GMC. Definitely HUMMER. Oh, wait…)! ;-P

  2. Agree to 100%.

    The only good thing that can come out of cadillac being pushed in europe is that everyone realize that its not such a great idea (similar to what happened with the 9-2X where even the top people admit that it was a misstake).

    I am not saying that Cadillac do not have a right to exist, but I am confident that it can do so together with saab and saturn.

    I see Chevy as the basic GM brand, with pontiac being the sporty basic car (drove a G6 and was impressed).

    Saturn is similar to Opel in Europe, better quality than Chevy, but a volume brand selling good cars for ordinary people.

    Saab should come after this, priced slightly over the saturns (I think taht the saturns will become more expensive as they move together with opel) feeding a more exclusive market competing with audi and BMW, and doing so by focus on design and safety (quality should be there without having to say it to the customer, and this is something that could be improved). Have noticed that a large nr of the 9-3 drivers are wommen, and I think there is a large untapped market here as men go for the beemers, but I think that girls want something different (less dominant).

    Cadie should be up against MB, selling luxury cars, appealing to the aged upper class, and I do not see Cadillac competing with saab….

    Where Buick fits in, I do not know, but they manage to sell them in China… However they have a brand immage problem, and what scare me is that it appears as if GM is continuing badge enginering as I think that the new buick suv is the same car as the saturn and GMC that started to be sold resently….. Maybe your friend at Fortune know… πŸ˜‰

  3. I just e-mailed Mr. Taylor III, gave him some of my opinions, and invited him to check out this ‘blog. Hopefully he isn’t offended! ;-P

  4. Well, it is true that GM has too many brands, and not enough marketing dollars to trumpet its successes. The Saturn Aura, for example, by all accounts an excellent car, is languishing for want of attention.

    The problem is as follows: (a) GM produces a car or SUV; (b) Chevy, Buick, Pontiac, and Saturn each get a variant of the same car or SUV; and (c) the market message is highly muddled because they is no consistent campaign for this new “car” which GM has badge-engineered into four (or even five) variants.

    The problem with killing Saab is that it doesn’t solve the brand confusion problem — in the first place, Saab actually sells unique cars — Saab does not contribute to the confusion in the first place; and second, killing Saab does nothing to solve the main identity confusion among the main brands. Lastly, Saab doesn’t sell enough cars to solve this problem.

  5. Here’s what I think GM should do:

    1. Treat Saab the same way Ford treats Volvo: Give it money and let it do what it wants because it knows its market better than GM does.
    2. Kill GMC, they’re completely redundant. All of GM’s other brands have at least one or two differentiating models, but GMC is pretty much just Chevy trucks with a differernt grill and emblem.
    3. Make Pontiac more focused on being one thing: Sporty versions of Chevys. That’s it.
    4. Keep doing what they’re doing with Saturn and Hummer. Hummer is a niche brand and GM is doing well with it. Saturn is doing great.
    5. Put more advertising dollars behind Buick, they could be great again given the right push. Maybe even add upscale sporty cars again, like the old Gran Sports (the ’70 GSX was the one of the greatest muscle cars of all time) or Grand Nationals/GNX. The new models show promise and could easily compete with the tepid new Mercurys.
    6. Stop wasting money on EuroCaddys and put that money towards giving American Cadillacs better interiors.

    Sigh…I miss Oldsmobile. Buick and Oldsmobile were the first two GM companies, you know. Admittedly, there was no reason to keep Olds since no one looked for cars of their level anymore, but I still miss them. Both of my parents had Oldsmobiles, they were nice cars.

    As for that guy being American centric…he wrote a blanket panning of all Euro cars in February, so yeah, he’s an idiot.

  6. I apologize for the incoherence of the previous posting.

    The persons responsible for the errors have been sacked. And the persons responsible for those persons have themselves been sacked.

    And now for the show to resume . . .

    (you know, a moose once bit my sister)

  7. Of all GM’s problems, Saab certainly is not the biggest. Even if Saab was “dead weight” within the GM organization, though, realize that companies do not simply kill-off pieces of their business, especially if that business segment has intrinsic value (such as the Saab brand). So, I think one of the best outcomes would be if GM sold Saab to an insigtful, deep-pocketed private equity firm that could invest in preserving and promoting the spirit of what Saab is known for, thereby turning a profit! I know it’s not quite that simple, but just some optimistic food for thought!

  8. The comments from Jeff are spot on. Invariably these clowns and inept operators from the US come up with headless, unfounded let alone senseless suggestions/comments like this ignoronamus. If the Yanks still haven’t got it on what Ford has done with Volvo and what this has done to Ford too, then no one can and will help them. GM should split its whole business in to 2 segments: American and International. Run these separately and then chop and change accordingly. That is one of the issues that Saab has, it’s all under one umbrella. Can some of these clowns come and have a look at what Holden has done single handedly ??? I am sure they were also calling to chop that head 15 years ago. Now we are exporting our cars back to them !!!!

  9. In fact, I think Mr, The Third has a good heart. πŸ™‚ He just isn’t a serious journalist.

    SAAB’s importance to GM isn’t about the cars it sells, but about what it can brig to the group.

    Just think of the Ethanol engines technology, the Plug-in Hibrids…

    All of the GM’s “Green Revolution” is based on SAAB’s R&D…

    Not to mention obvious things like safety or turbo engines (which seem to be the future).

    And that will translate to increased sales all over the group’s brands.

    Mr. The Third: you need to learn how to be a serious writer! πŸ˜‰ …and do some homework.

  10. I agree completely, Swade!!

    Except for the whole III part… I’m a III myself, and I’m definitely on par with I and II this early in my life πŸ˜›

    GM needs to employ CTM, Mgescuro (from gminsidenews.com) and yourself as independent consultants. All of you all have the passion, the connection with the market and the insight that GM seems to be lacking.

  11. All ‘sequel’ references were just for comedic effect. I respect the IIIs of the world. We’re all really just a meeting of sperm and egg, regardless of the numbers.

  12. I’m not savvy enough to know how GM can fix all of its myriad problems. I’m a computer programmer. What I do believe is that Cadillac will never be very successful in Europe unless it ceases to be the same Cadillac that is recently thriving in the US. The GM/SAAB execs who on their own US site position SAAB against Audi and BMW need to rent some Audis and BMWs for their marketing folks so that they actually know that they are competing against a tangible product that car shoppers test drive, not just a name. SAAB can improve the places where it’s lacking against those marques and GM will be happy that they kept SAAB around. If they continue to unrealistic expectations for SAAB that are unmatched by the investment dollars then SAAB is in for a long fight. There’s lots of new product coming so it will be interesting to see if they’ve raised the bar on materials and build quality (can only compare to my current 2004 9-3 Aero and previous 1998 and 2001 900 and 9-3).

  13. Agreed.

    Saab is GM’s only true brand capable of competing on the essential “sport sedan” market, but it needs some serious capital investment, something that has been lacking since long before GM took over the reigns of the company.

    Dumping money in to Cadillac in Europe is such a dumb idea I have to wonder what the GM execs are smoking.

    I lived in Europe for 16 years. Thats long enough to know that the brand Cadillac does nothing but get people who buy them laughed at for buying a “silly american boat” in Europe. it doesn’t matter how much marketing hype or technological advancement GM undertakes. Cadillac will never be viable in Europe.

    They have a brand just waiting for investment to become a contender in the Euro luxury market, but GM just inexplicably keeps passing Saab over for capital and R&D investment.

    That being said, I agree that GM needs to cut brands. There is too much internal competition and distraction with the varied lineup.

    Here’s my plan for GM.

    – Keep one low cost brand, Chevy, Pontiac or Saturn. Kill the other two. Integrate the remaining low cost brand with European Opel operations for one worldwide lineup.

    – Kill Buick. It is a pointless brand that year after year sees more of its customer base die off. (literally)

    – Kill GMC and make trucks in each remaining brand. Produce only uni-body based SUV’s for the Euro brands (Saab/Opel)

    – Platform share between Cadillac and Saab. Keep Cadillac as the luxo-cruiser brand and Saab as the Euro-performance brand. Don’t – however – make this platform sharing too obvious (like 9-2X/wrx, 9-7x/Trailblazer, 9-3/BLS). The cars need to have different character, engine options as well as the small details (door handles, buttons etc.) GM needs to learn that only parts that are invisible to the customer (both in appearance and performance) can be shared between brands. Customers are not dumb enough to fall for badge engineering anymore.

  14. Oil’s too good for him.

    Classic case of American-centric thinking.

    He’ll be after GMDAT, Opel, Vauxhall and Holden next.

  15. Agree with CJ above.
    Strongly disagree with mattlach. Platform sharing with Caddy is exactly the wrong direction for both. They need to be opposites.

    I do have to agree with Alex Taylor III to a certain degree though. There’s a saying from the American Revolution, “Give me liberty or give me death” and it could apply here. I have no interest in seeing Saab fall to GM generecide, an since I don’t see anyone rising to buy Saab, it may come to that.

  16. Adam:

    Sharing a platform does not mean all that much in the grand scheme of things, as long as that platform is stiff enough.

    The “feel” of the car comes more from suspension tuning and engine choices.

    The only reason I suggest platform sharing with Caddy, is because Cadillac has a lot of money right now and have access to some of the best technology within GM. Otherwise we’ll just see more of the same Epsilon platform sharing with Opel and Chevy…

  17. Mattlach:

    No one will buy Opels here, that’s why we have Saturn. Saturn cars have always been decent low cost cars, and now that they’re rebadged Opels, they’re even better. Why confuse us Americans with a brand new brand?

    I can almost…almost see killing Pontiac, but in some markets they sell better than Chevy. It’s a regional thing here. They just need to be more focused, I think. There isn’t enough differentiation between Chevy and Pontiac. Pontiacs are supposed to be American Sporty (as opposed to Saab, Euro Sporty). If Pontiac focused on that and that alone, they’d do better imo.

    Killing Buick would be a bad idea. Sure, Mercury isn’t exactly a powerhouse anymore, but GM still needs to compete against it, and that’s Buick’s job now that Olds is sadly gone. New Buicks are nice cars. I’m seeing more and more of them driven by more and more people, not just old guys. Plus, they sell very well in China. Plus plus I really want sporty Buicks to come back and I know I say that in pretty much every post but my God I love Buick muscle.

    You can’t just consolidate all of your brands like that, that’s not how business works. You can, however, consolidate them internally and leave names the same (like with Saturn and Opel).

    Considering GM and Caddy platforms are the same thing, Saab is already platform sharing with Cadillac :p

    Summarily, GM isn’t Ford, they don’t have one worldwide name and they never will. It doesn’t affect business much. You cannot just “cut brands.” That’s not how it works. You fix the brands you have. GM needs to focus, not downsize. Work smarter, not smaller.

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