Automotive News: Hummer and Saab Good for GM

Robert Farago
by Robert Farago

Automotive News [AN, sub] is running a pro-GM byline-less piece under the heading "Running the Numbers." "Hummer, Saab: GM's conquistadors" argues that Hummer and Saab's sales may suck and the brands may be sickly, but they're worth keeping in GM's bloated portfolio because they attract non-GM buyers. The numbers certainly run in the right direction– some 61 percent and 50 percent of Hummer and Saab sales (respectively) involved a non-GM trade-in. But there's no evidence that this "new" loyalty will continue or trickle over to other GM brands. And no matter how you slice the badge-engineered Saab and Hummer pies, there's not enough of it to justify the struggling brands' ongoing drain on the company's rapidly diminishing resources. IMHO.

Robert Farago
Robert Farago

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  • Whatdoiknow1 Whatdoiknow1 on Sep 10, 2007

    SAAB was an also ran company that would have been out of business anyway today if GM had not stepped in to breath new life into it. A lot of folk here like to talk up the former virtues of both SAAB and Volvo. Face it GM and Ford did not truly hurt either of these companies. It was Honda, with its new Legend in 1986 that ws the death of both of these brands. SAAB is all but irrelevent today and has been so for the last decade. Yes there are some "fans" of SAAB but there just aint enough to make a difference. The costumers that SAAB needs to be successful are all buying Acuras, Audis, Infinitis, Lexuses, and get this .....high-end Hondas, Nissans, and Toyotas. Quirky Swedish automobiles are just that! They thrived during a time when the Japanese were not playing at their market level but those days are long gone and the competition is making better cars with more value. End of story.

  • Hal Hal on Sep 10, 2007

    Just what "new life" do you think GM breathed into Saab? I agree that SAAB was an also ran company in 1990 but so was Audi and Lexus and Acura were only a few years old. GM had the opportunity to develop a range of euro luxury cars to compete with MB and BMW but they didn't even try. The right comparison isn't Ford and Volvo but Ford and Jaguar. Volvo is doing just fine with good brand management and a decent range of vehicles but both Jaguar and SAAB have been screwed by underinvestment and poor management. GM's neglect of SAAB is criminal, they have had 17 years and what have they done? I wish they would just sell SAAB and give someone else a chance to run it... As far as Hummer goes I hope GM makes a ton of money selling luxury trucks to idiots - long may it continue but are they really attracting people who would otherwise be "non gm buyers"? I wonder what people cross shop when they are buying a H2 or H3?

  • Trollhattan Saab Trollhattan Saab on Sep 10, 2007

    Saab brings a lot more to the table than the potential for far greater sales (which it definitely has). Saab are GM's only global premium brand. You want to about GM wasting money, RF? How about the millions upon millions they're pouring into Cadillac in Europe. The BLS is made in Sweden and there's plenty of Saab employees there who could get it at a reasonable discount. How many of these sold in August in Sweden? Seven. And it's going to stay that way according to all I hear from on the continent. GM have been treading water on Saab (i.e. slowly drowning) for years and it's only now that they're investing rather than plugging up leaks in Saab's finances. But I digress.... What else does Saab bring to GM? They're GM's specialists on turbocharging. As more companies in high-fuel-price markets seek to downsize engines, this is becoming more and more of a factor. They're also GM's specialists on E85. Saab actually get more grunt from E85 through turbocharging and making better use of the high octane rating. You still lose on fuel economy, but at least its a practical application for E85 rather than just a CAFE-dodge like having E85 pickups. Saab have the biggest selling E85 range in Europe right now (Saab BioPower) and E85 is coming on board in more and more countries there. It's not THE solution, but it's part of a solution and it's available now and Saab are very, very good at it. Now, Saab are also taking on specialisation in the application of the new XWD system to GM's traditionally front wheel drive drive platforms. Saab are debuting this in Frankfurt this week with the Turbo X. The XWD system will trickle down to other GM uses in time and Saab will be responsible for it's application on these other GM brands. With a bunch of new models coming in the next few years, plus all this expertise to give, I think it stacks up reasonably well in favour Saab keeping a spot at the table. As long as GM make some right decision in the next few years and Honda don't release another Legend. Sheesh.

  • Gentle Ted Gentle Ted on Sep 11, 2007

    From the CAW web page, the new hourly rate for vehicle assembley people in Ontario will be Can.$33.91 per hour, Electricians get $40.31 not bad eh!