Selling eight brands’ worth of vehicles under the “Employee Pricing for Everyone” banner does nothing to reassure jaded “I won’t ever buy domestic” car shoppers that GM isn’t Wal-Mart. Even so, GM makes some great– well very good anyway– rolling stock. But a quick bailout from the Feds won’t fix the cash-burning automaker in time for consumers to discover this fact. It will simply prolong The General’s “we’ll muddle through” mess until the next crisis. What GM’s North American ops really need is a full, head-on crash into the wall of bankruptcy, followed by private DIP (debtor-in-possession) financing. Meanwhile, it’s a real Saab story.
News flash! During the last GM fire sale, I bought a 2007 Saab 9-3 2.0T. The 9-3 offers a great combination of comfort, handling, performance and decent fuel economy. Safety? Top pick of the IIHS. In an era of high gas prices, when every automaker scrambles to make small cars “cool,” GM’s got a darn good one.
Only no one knows about it. Instead, The General is busy trying to convince the public that the electric car of the future is on its way. Wake me up when the Volt arrives. Until then, why bother? What IS the point, especially when it comes to Saab?
GM began its Swedish odyssey in 1990 (with 50 percent ownership). The takeover reached fruition in 2000, with complete ownership. GM’s thinking at the time: Saab would provide the company with a Euro entry lux vehicle for the U.S. market. GM would gain sales by expanding the Saab offerings upwards, fending-off rising competition from both the new Japanese and stalwart Euro lux brands.
Wait. Wasn’t Cadillac supposed to be GM’s upmarket brand? Did GM really need Euro-badged vehicles? Perhaps Saab’s takeover was an admission of the damage already done to Cadillac. Or maybe it was reverse badge snobbery from the Powers that Be. No matter how you look at it, GM never figured out what to do with Saab.
Saab launched its volume leader, the 9-3, in 2003. It had a host of problems, mostly electronic. Vehicle testers/raters like Consumer Reports ranked the 9-3 as “problematic,” giving the brand a black eye. No one really expected a Saab to be as reliable as a Toyota; the car’s quirkiness, Swedish design elements and turbocharged engine offered a trade-off. But for a company (GM) as supposedly committed to vehicle quality to build and sell a modern era car that didn’t work well (to put it mildly), well, the damage was done.
In subsequent model years, the problems were mostly resolved. But Saab’s sales never recovered. They declined from 2003’s peak of 48k units to last year’s 30k last year. Sales in ’08 are set to be much, much worse. It’s been widely reported that GM’s lost money on Saab for all of the years it’s been involved.
During this decline, RenCen decided to expand the Saab lineup on the cheap. It looked to leverage its investment in Fuji Heavy by rebadging a Subaru WRX as a Saab 9-2x. No one was fooled; the small Saabaru never sold more than a few hundred units a month, and the experiment quickly ended. GM also decided Saab needed an SUV on the other end. The General repackaged it’s less-than-stellar Chevy Trailblazer as a Saab 9-7x. Same result. Like anyone really thought this vehicle-– built in Ohio– had any linkage to the brand? Where was the true Euro-flair, the ride, the design? Gone.
To make matters worse, GM launched a new tagline for the brand in the fall of 2005 with a massive (for the brand’s size) media campaign: “Born from Jets.” Ok, like anyone in the USA had any clue that Saab started life as an airplane company? Can anyone name a Swedish jet? Did anyone care? Suffice it to say, as mentioned above, the campaign failed miserably.
Strangely, the Saab 9-3 today could be the right car for times. But GM bungled the handling of the brand from the beginning, and then compounded mistakes. It’s too late to breathe fresh life into this dead brand.
Think of other GM brands where this exact pattern has been repeated. GM’s mistakes with the Saab brand reflect the problems GM faces with consumers across its entire vehicle line-up: poor build quality and mechanics (now mostly resolved), lagging technology, stale designs (much improved today), overlapping vehicles (still an ongoing problem) and weak brand equity (getting worse all the time).
I want GM to make it. I’m an American. But why should the Feds give money to a corporation that’s done such a piss-poor job handling its North American business, such as selling one of its only competitive cars? What makes anyone think GM will do better with a bailout? No, GM needs to crash in North America and then rise from the ashes. It’s the only way.
The employee pricing gimmick failed the first time they did it-it shows their desperation that they tried it again. The first time around, it increased sales significantly while the promo ran-but it brought in very few new customers-most of the people who bought a GM vehicle during the last employee pricing thing were planning to do so anyways, just not right then, but in a few months. So, sales fell off a cliff as soon as the promo ended. That is, the promo didn’t create new sales, it merely “pulled ahead” sales that GM was already going to get (at lower tranaction prices to boot).
This time, the employee pricing thing couldn’t even bring sales up to the level they were at last year-sales were down 20.4% this August compared to last August. So they probably would have been down 30-40% or so if they didn’t do it. This means that I would expect, come December or so, for sales to be down by as much as 50% overall (due to the pull ahead combined with the overall sales decline), which might be near fatal for GM.
Now, as for Saab in particular, their sales in August were already down 50.1% compared to last August, for a total of only 1,503 units sold total (9-3, 9-5, and 9-7x combined sales for the whole month). For comparison’s sake, that’s about a day’s worth of Camry sales alone. Their sales in Europe are down as well (although not by anywhere near as much). I can’t see how GM can afford to keep them alive.
Draken. Viggen. Lansen. Safir. Tunnan (actually a nickname, meaning Barrel, which is what it was shaped like). And many others.
I’m just showing off here, but the original SAAB (Svenska Aero AB) was in fact quite an aviation pioneer. They invented the ejection seat, among other things, even though the Germans or Brits usually get the credit.
The SAAB 21–twin-boom pusher-prop single-seat strike fighter–was enormously advanced for its time (early ’40s) with a Daimler-Benz V12. That’s why they invented the ejection seat, so the pilot wouldn’t get Cuisinarted by the aft prop during a bailout, although the entire prop assembly supposedly had an explosive device to blow it off if necessary. (Nice thing to fly around with, wondering when a stray electrical spike would set it off…)
The 1948 Tunnan was a swept-wing jet that arguably predated the MiG-15 and NA F-86.
Anyway, it always amused me that SAAB came up with the “Born From Jets” line something like two decades after the car company was totally split off from the aircraft company. Sort of like Rolls-Royce arguing that “it” made 747 engines.
I picked up a 2005 Saab 9-2x Aero whilst shopping for a WRX wagon… I was surprised to learn that they could be had used for $3-$5k less than a comparable WRX, and had leather/HIDs/17″ wheels/auto climate control, etc…
I am happy that GM decided to try and “create” an entry level Saab. I love the fact that I am driving one of only about 10k 9-2x’s that were ever made. Not that it will ever be a collector’s car, but it’s still pretty unique.
But the car was probably originally retailed in GM FireSale v. 1.0, for significantly less than the $29,860 MSRP. Today, Saab’s notorious depreciation has killed the resale of this car, it hovers around $13-$15k depending on who you ask. A WRX of the same vintage commands a premium.
Funny how selling a ton of 9-2x’s in the summer of 2005 killed the relationship with FHI, as they bought back their shares shortly after realizing that GM was cannibalizing their Impreza/WRX sales… Another brilliant move on GM’s part.
As a mid 80’s Saab fan, I miss the real quirkiness of the cars – those fat, 3 spoke wheels, the boxy, bathtub shape, great seats (which they still have) and the cool, whacky rear design. Saab had balls.
The cars themselves are likely more reliable now, but they lost their raison d’etre.
Wait. Wasn’t Cadillac supposed to be GM’s upmarket brand? Did GM really need Euro-badged vehicles?
In the US, it’s GM’s upmarket brand. Saab was bought because it’s a world-wide brand and had the potential to be GM’s upmarket brand in the entry-premium market world-wide. Of course, that potential has all but been choked out of it thanks to various acts of numbskullery.
Now GM are trying to push Cadillac in the world market and what they still don’t understand is that only a couple of thousand people outside the US actually want a Caddy. And a portion of those want their Caddies old, with big fins so that they can show them off at a local car show on a summer Sunday afternoon.
Saab’s potential, and when you look at the way cars are going (smaller, turbocharged, versatile) they should have plenty of potential, is being held to ransom because the powers that be in Detroit can’t imagine a future where Cadillac isn’t at the absolute top of GM’s tree.
—–
By the way, the photo at the top of the article is a 2006 9-3 Aero, the first of the twin-scroll turbo V6s from Saab and the last year to feature the brilliant and beautiful button dashboard.
The photo was taken in the southwestern suburbs of Hobart, Tasmania. It was a great day.
You can’t hang around Saab people and not get really depressed. These are people who genuinely loved their cars and probably would have bought them again and again, had GM not completely screwed up by trying to make Saab into a mediocre BMW.
Let’s list the mistakes, shall we?
* We know about the 9-2 and 9-7, so we won’t rehash those.
* The 9-3, quality issues aside, debuted in 2003 without a hatch and lacking in useful quirkiness. That’s fine, says, GM, we want a BMW fighter! Of course, to make a BMW fighter, the car actually has to be as good as the 3-Series, or nearly as good but slightly cheaper (like the G35). Guess what the 9-3 wasn’t?
* By the time the 9-3 wagon showed up, Saab buyers had more or less given up. Did you know that they didn’t have a wagonoid 9-3 in Europe at launch? Boy, there’s smart incarnate, there.
* Saab more or less got castrated when GM handed design over to Opel. There aren’t any real Saabs anymore, and none in the pipeline.
* Speaking of the pipeline, Saab has shown some pretty nice concepts over the past few years, all of which have amounted to squat. The Aero-X? Probably Mazda’s Furai has more chance of hitting the dealer lots. To be fair, GM does the “Bedazzle-with-chrome-but-keep-selling-tin” with all its brands.
* The 9-5 has been on the market for ten years now, on a platform is shared with the Saturn L-Series. It won’t see a new platform–one it will share with the Malibu–until on or after 2010. Twelve-to-fifteen year model stretches are bad for econocars, for a luxury flagship it’s inexcusable.
* Did you know that you can find switchgear in a 2008 9-5 that was present in a 1993 900? Did you know that it wasn’t great switchgear in 1993?
* Saab’s demographics were perfect for hybrids: left-leaning, accepting of quirkiness, urban, highly educated, relatively affluent. In short, the same people who buy Priuses. I know at least fifteen former Saab owners who now own Priuses now, and are not coming back to the fold even if GM were to make a hybrid Saab.
* Which reminds me, did you know which brand/models are getting hybrids? Chevy (the bargain-basement brand) and Cadillac (the Escalade). Can you think of a less green vehicle than the Escalade? It wouldn’t have suprised me to know GM was readying a hybrid Hummer H2 before a Saab.
* The Cadillac BLS and new, upmarket direction of Opel. Not content with screwing Saab in North America, GM seems bound and determined to f_ck it up in Europe, too.
* Warranty. Would you buy one of the most notoriously unreliable and expensive cars when it’s warranty is one of the shortest in the industry?
* Leasing. Given the above point about warranty coverage and reliability, as well as it’s atrocious resale value, would you even consider a Saab without leasing? I’d have trouble with buying an Acura or Infinit, but a Saab? You’d have to clinically insane.
I could go on, but as a current Saab owner, it’s just too painful. GM Product Planning has no clue, and Saab is the most poignant example of their lack of ability.
Farago votes nay
Elias votes nay
Zoom Zoom votes nay
Dozens of others vote nay
But unfortunately, they won’t be counting OUR votes when this chicken comes home to roost…
You forgot Oldsmobile, the old people cars that were transformed into Import Fighters.
So is Saab the New Olds?
I tried to buy a 9-2x from my local Saturn-Saab store (they’re twinned in Canada). No luck.
Really, I gave it the good old college try. Visited the dealer, the only one that I could test drive was a demonstrator (used) automatic that they had been using for shuttling service customers. I wanted to test drive a manual (no way was I buying an automatic). “We’ll have one in any day now, we’ll call you.” The dealer knew that I was looking because my lease was up in 4 weeks – I was a very good prospect.
Alas, no calls, so I called them. At least three times. No call backs. I drive by the dealership almost every day on my way to and from work, but no sign of any new 9-2Xs on the lot. A GM Canada web site inventory search showed four 9-2 manuals in stock at my dealer – who knows where they where. Meanwhile, national newspapers carried regular (and expensive) ads promoting the 9-2x and special pricing. “Visit your Saab dealer today”. Hah!
I gave up and purchased a loaded Mazda3 GT. Nice car. Great car. About 2 months later I got a call from the dealer asking if I was still looking for car. I asked if they had any manual 9-2xs in stock. Nope, but they thought that I should have a look at a “very nice Ion”. Geesh.
A Saab story – lousy dealer, poorly timed ad campaign, no alignment of the Internet and retail sales channel, no inventory (apparently). End the experiment GM.
I think both Saab and Volvo have suffered badly from their parent companies’ efforts to push them further upstream than the brands could support. In fairness, that was happening somewhat during the eighties as a result of inflation, but I think GM and Ford looked at that as an opportunity, rather than a problem.
In the mid-range between the proletarian brands and the German luxury labels, I think Saab and Volvo would make a case for themselves. Against the 3-series and A4, it becomes a hard sell. The 9-5 and S60, for instance, are not bad cars, but at the price, they’re also-rans. (Not to mention the nagging feeling that anything I might want in a Saab, I could more easily find from Subaru…)
I think the only future Saab has is as the Scandinavian “Opel.” Sort of the way that Vauxhall is now the British “Opel.”
Saab Insignia? Saab Astra?
Johnster:
Too late, it’s called Saturn. SAAB is SOL.
SAAB Viggen, and the cold-weather version, the Friggen.
SAAB Viggen, and the cold-weather version, the Friggen.
Hah! Memories of driving a summer-tire-equipped Viggen on a snow-covered road come back to me. What a deliciously evil car.
I used to think Saab had a good thing going with the Viggen and I wish they’d expanded it. It was a wonderfully unbalanced car: fast, especially when already in motion, with a great comfy-but-sporty-but-practical interior and a demonic nature that required you pay attention and drive, not let the car make you look like rock star, unlike the 3-Series. You could post good numbers in the Viggen, but you’d have to earn it.
If you asked me what a modern muscle car is, I’d probably give it as an example.
As I said, I thought it could have been expanded: a blown-till-its-eyes-bulge 9-1 and perhaps a 9-5 with granite suspension and a silly-agressive overboost function). Something–anything–that would have made them stand out.
My Saab dealer sucked. It was worse than a domestic. The sleaziest, laziest bunch of MF’ers I have ever dealt with. That said, I got my 9-2x Aero with 8k off and never looked back.
Funny, but the only GM part on the car was the badge on the hood, and that fell off in the first year. Every other Saab on the road has the same problem.
Stupid GM!
Since when did this bailout become a “Bash GM” scenario? Last time I checked, there were others that were to benefit from gubment $$$.
Very telling…
I did not realize that the Saabaru was another GM derpreication hidden gem like the the diamond in the rough like the Pontiac Vibe or Geo Prizm
Something like the Corvette can be improved by leaps and bounds every single year. Lower price, lower weight, more performance. Every year.
Where is the vehicle refinement and mid year product updates and refreshes to keep things exciting?
They keep building vehicles that don’t sell in their current configuration at their current price.
Change up every vehicle in a way to make it desirable.
I dont care if the XLR came with a Chevy badge, except the badge is played out, ugly and non car folk will perhaps not look at it. Its a tragedy that society thinks so little of itself that it tries to justify money and prestige as means of worth of an individual. I do not think much of the 8 brands, I like cars, I know a bit about each car. Although considering the number of TV brands out their, and PC parts, etc etc…..its hard to get into many brands. I see good reviews and bad ones all the time.
I think its sad that people think what others think means something. Cadillac and Chevy might have been one brand other wise. Or at least a Chevy wont think he is better than a Caddy owner. I need the serenity prayer for this too.
They tried to boot the Saab volume by building Cadillac models in Sweden. With this I mean the Cadillac BLS, which is esentially a Saab 9-3 with some optical changes.
Of course nobody in Europe would touch a Cadillac with a barge pole, so it is a true flop.
And instead of bringing the car to the US … well you may guess … we are talking about GM here.
http://en.wikipedia.org/wiki/Cadillac_BLS
I owned a Saab once. I bought it after my wife neglected to set the brake on my ancient Subaru and allowed it to roll down the hill and self-destruct against a neighbor’s house … ‘nother story there. Anyway, I needed a car in a hurry and I wanted something fun to drive, the 318 was gutless and the 325 was too expensive, so I bought a 900, *first* year of the new body style (mistake no. 1). The non-turbo 4 was weak, they weren’t importing the turbo 4 yet, so I got the V6. Made in England by Vauxhall/GM (mistake no. 2).
Great car to drive – fast, comfortable, kind of a pugnacious personality.
However …
The car arrived lacking the A/C relay. Well, I guess it doesn’t get warm in Sweden. But over the next 40,000 miles the following problems developed:
– Leak from oil pan gasket
– Leak from oil pressure sending unit
– Leak from camshaft seal
– Leak from crankshaft seal
– Leak from valve cover gasket
Then I traded it for another Subaru. It was still leaking oil from somewhere, possibly the other camshaft seal … I did get to drive a lot of loaners from the dealer though.
Since when did this bailout become a “Bash GM” scenario? Last time I checked, there were others that were to benefit from gubment $$$.
Because Chrysler is privately held and can sink or swim on Cerberus’ dime (or could–rightfully–sue Daimler for running them full-steam into a brick wall) while Ford isn’t suffering from nearly the level of idiotic product planning.
Oh, and because I like Saab and resent GM’s mismanagement of it. Volvo under Ford at least got a decent model mix and engineering support–their problem was that they spent their resources chasing Mercedes. GM just left Saab to rot.
I remember my mother having to pay $900, which was a lot of money in the late 80’s, to get her water pump replaced on her 9000. It was inside the fuel tank, which required almost complete disassembly of the car. Parts also had to come from Sweden, as none were in stock. The repair thus required several weeks.
Say what you will, GM has improved certain aspects of the Saab ownership experience.
Although that 9000 was a sweet car…when it worked. A big, heavy, European car with a great ride, lux interior and great seats. You didn’t mind that it was slow even for the time…
The water pump was inside the fuel tank???? Not possible. Even the Swedes wouldn’t run the coolant from the front of the car to the rear and back again. Maybe Porsche would…
Even the Swedes wouldn’t run the coolant from the front of the car to the rear and back again
It’s an Italian car, not a Swedish one. I’m not sure of the details, but I think the 9000 was mostly a Fiat design that Saab adopted. The 9000 had a column ignition key, unlike either old or new 900.
And yes, I’d totally believe that Fiat would put a water pump in the fuel tank.
{ psarhjinian :
September 10th, 2008 at 12:41 pm
* The 9-3, quality issues aside, debuted in 2003 without a hatch and lacking in useful quirkiness. That’s fine, says, GM, we want a BMW fighter! Of course, to make a BMW fighter, the car actually has to be as good as the 3-Series, or nearly as good but slightly cheaper (like the G35). Guess what the 9-3 wasn’t?
* By the time the 9-3 wagon showed up, Saab buyers had more or less given up. Did you know that they didn’t have a wagonoid 9-3 in Europe at launch? Boy, there’s smart incarnate, there. }
All of this was to suit the US market. Conventional wisdom held that Americans associated hatches with cheap cars so the 9-3 was hatchless. Americans didn’t buy station wagons either so no wagon version. The 9-3 helped Saab to a 27% sales lift in the US in 2003 but sales in Europe flatlined. Then in 2005 Saab lost almost all of what it had gained in the US. GM was really banking on making the car a hit in the US and it was prepared to sacrifice sales in Europe.
In early 2006 I cross-shopped one of these with the Audi A3 2.0T. I like the shape of the Saab 9-3 more but even with the so-called “employee pricing” it was more expensive than the A3. Not to mention that the A3 was a just released model whereas the 9-3 has been released for over 3 years. Guess the GM dealer I visited was not desperate enough then; as he was still trying to con me with the typical car salesman b.s.
Oh and how come these Bailout Watches are not sequential? I see 32 and 36, where’s the episodes in between those two?
had the classic 900 Turbo. Stout seats, built strong, liked to cruise at 85 mph with the boost gage at zero. Great mileage, hatch a bonus. Occasional Cranky Saab Syndrome.
Later a 9-3, 1st gen. The same flavor, in a Opel derived body. Fischer Price interior, great seats.
cross shopped the 9-3 before the current car. Loaded, near 3 series price WTF ? but stripped could be had for slightly over 20k and a deal there. I wanted it loaded, but if you are going to pay BMW $ you should probably get the BMW.
I never understood the 9-2 or 9-7. Saab had a true unique selling point, the “anti-style” car, both fast and efficient before that became a buzzword.
Saab folks were the perfect hybrid customers, hold the smugness
psarhjinian: It’s an Italian car, not a Swedish one. I’m not sure of the details, but I think the 9000 was mostly a Fiat design that Saab adopted. The 9000 had a column ignition key, unlike either old or new 900.
And yes, I’d totally believe that Fiat would put a water pump in the fuel tank.
The 9000 platform was the result of a joint development effort by Saab, Fiat, Lancia and Alfa. It wasn’t an Italian design adopted by Saab — Saab actually had a big hand in making it.
Saab’s mismanagement is a crying shame and is part of the reason Saab is now floundering hopelessly. But what really killed Saab wasn’t BMW or Audi or Mercedes or VW or even GM’s indifference — it was the G35/IS250/TL/TSX. Historically, Saab benefitted from the fact that if car shoppers wanted a European style car in the entry level range, they were limited to BMW, Audi, Mercedes (at the high end), Volvo and an occasional Alfa. Each of these car brands, Saab included, had a distinct brand identity that each wore on its sleeve — BMW as performance driving, Mercedes as ultimate luxury, Audi as German precision, Alfa as Italian Passion, Volvo as cautious Swedish comfort, Saab as Swedish comfort juiced by turbo engines and unique features.
When the Japanese carmakers started hitting the entry-level luxury market with cars that came damned close to the Euro competition in performance and luxury terms but also featured impeccable reliability. These cars proved real challnges to the big selling Euro’s but in the process crowded out Saab. Saab just fell further and further behind, unable to drum up the resources to adjust to the changing marketplace. In fact, I suspect Saab never even took the Japanese seriously in part because they never understood that the hyper-competitive US market was their largest market, choosing instead to benchmakr their cars against a European market that, while obviously helpful, did not provide the kind of trial-by-fire that the US market provided. Hell, many years ago I spoke to a US Saab product manager who admitted that he had fought for years to get Trollhattan to take the G35 leel cars seriously, only to be ignored.
The final nail in the coffin for Saab is the SUV. People who needed to haul stuff bought SUV’s, not the 900/9-3/9000/9-5. Wagons may be Euro-popular but they are dead in the water here in the US, and it took Saab 4 years to come up with a wagon version of the 9-3 to try to compete.
Saab has a valid reason to exist — style, utility, unique features, creatiuve technology and quality/durability, coupled with turbo engines. And a litle batsh*t-crazy-uncle-Olaf thrown into the mix with fun experiments like the Viggen. Someone should have done better. But GM had too much baggage of its own to carry to worry about making sure Saab’s brand identity was seen through the last 10 years.
It’s time to euthanize Saab or sell it to someone who gives a crap.