By on June 9, 2008

saturn-sl1.jpgSaturn is dead. Despite a thoroughly refreshed line-up– including a mild hybrid, a Lambda-dancing CUV, a sexy sports car and a cute ute– the brand can’t get wood. In fact, Saturn’s sales are the very definition of flaccid. Year-to-date, they fell 19.9 percent. In May, sales sank 32.7 percent. In this process of final dissolution, the once autonomous upstart GM brand has become an irrelevant Opel outpost. Saturn’s Spring Hill, Tennessee factory is now in Chevy’s hands. Plastic body panels and unique designs have been swapped for rebadged leftovers from the GM parts bin. Saturn’s slow homicide is more than a shame. It offers a discouraging glimpse into General Motors’ dysfunctional culture.

The Saturn brand was GM CEO Roger Smith’s $5b excellent adventure. Both internally and externally, GM sold its new brand dawning as the American automaker’s import fighter. And why not? The company’s homegrown initiatives to repel the import invasion– the Corvair, Vega, X- and J-cars, etc.– all flopped spectacularly. Equally important, Smith recognized the cultural paralysis within his own Empire. Something had to be done.

Saturn’s mission: drag GM kicking and screaming into the twenty-first century, the new era redefined by The General’s foreign competition. To do the deed, GM’s re-boot boasted all the hallmarks of the Toyota Production System– just-in-time inventory management, lean manufacturing methods, flexible job classifications– combined with plant automation that could eventually render the United Auto Workers irrelevant. In tandem with the California-based, joint NUMMI operation (with Toyota), Saturn would reinvent GM, if not the entire automotive business.

Smith singularly failed to cultivate the organizational buy-in necessary to implement the plan. Managers fond of rejecting anything remotely Japanese considered Saturn a parasite sucking resources from their pet projects. UAW leaders knew that Smith would use his beloved robots to sign their pink slips if given the chance.  Smith’s efforts to expand centralization and badge engineering among the existing divisions and his abrasive personality only deepened bureaucratic resentments.

Despite the acrimony, Saturn fulfilled its initial promises. Reviews were favorable. Buyer loyalty for the no-haggle proudly domestic car brand achieved cult-like status. But internal politics sealed the marque’s fate. Smith retired in 1990, just as Saturn’s first cars were launched.  Robert Stempel, Roger Smith’s loyal successor, resigned only two years later. As its champions disappeared, Saturn floundered no sooner than it had begun.

Saturn’s limited, aging lineup quickly stagnated. Sales peaked in 1994 at 286k units, well short of the 500k goal. In fact, 1993 was Saturn’s only profitable year.

Jack Smith became CEO following Stempel’s ouster.  Clearly no relation to Roger, the new Smith dismantled the trappings of his namesake’s regime. GM’s standby strategies favoring cost cutting and large, low R&D vehicles were restored. Smaller cars, sad aberrations best left to foreigners, would be obtained from overseas from marques such as Isuzu and Fiat. 

Current CEO Rick Wagoner continued Jack Smith’s agenda. Wagoner also peddled gas guzzlers, although this time to no avail, while completing the rogue Saturn’s dismemberment. If Jack Smith plunged in the knife, Rabid Rick twisted the blade.

Saturn really was “a different kind of company.” But resistance to change is a hallowed tradition within the GM family.

Peter Drucker, the father of management consulting, encountered GM’s insularity as early as 1946. His seminal study, Concept of the Corporation, extolled the automaker’s organizational successes, but advocated increased decentralization and empowerment of line workers. Drucker’s questioning of GM orthodoxy was considered blasphemy. Managers caught with the book were subject to termination. Then-Chairman Alfred Sloan was so incensed he later wrote his memoir specifically to rebut Drucker’s analysis.

Six decades later, little has changed. Success is perceived as an entitlement, deserved after decades of dominance. A not-invented-here mentality and superiority complex make meaningful change nearly impossible. Foreign rivals are still regarded with contempt, their tiny cars mocked as effete trinkets unsuitable to American tastes. Worker autonomy and equitable supplier relations, essential components of successful JIT lean production systems, are disdained for usurping management’s sacred duty of unilateral, top-down leadership.

From management’s perch above, the dismal sales of Aura, Outlook, and Astra confirm the fate of those who dare stray from the General’s path. Ironically, the dying legacy brands are adding to Opel West’s declining stature. Buick’s recent Chinese exploits and the baby boomer buzz of its Enclave crossover raise false hopes for the future of the Buick-Pontiac-GMC trifecta.

The upcoming redesigned 2010 Aura should deliver the knockout blow. GM intends to spoil that party by shackling the attractive Eurosedan with uninspired US-spec drivetrains. With their standalone stores and inadequate corporate support, Saturn’s dealers can expect to pay dearly for that mistake.

Sadly, the next Aura’s misfire will assure GM management of what it has believed all along: Americans don’t really want smaller cars. Caught within the quagmire of Michigan’s splendid isolation, Saturn never stood a chance.

Get the latest TTAC e-Newsletter!

Recommended

52 Comments on “Saturn’s Sad Legacy: Nothing...”


  • avatar

    I had to laugh this weekend. As I was driving across Ohio I came across a Saturn dealer closed. Out of business. For sale sign.

    Sign across the street? Coming Soon: Hyundai dealer. Says it all.

    John

  • avatar
    thalter

    That’s too bad, because the 2010 (there’s that year again) Saturn Aura/Opel Insignia is one sexy ride (Kind of a cross between an Passat and a Jaguar XF). Look for yourself:

    http://www.caranddriver.com/reviews/hot_lists/car_shopping/family_four_doors/2010_saturn_aura_opel_insignia_car_news+view-photos.html

  • avatar
    netrun

    Saturn had it all: fuel efficient, crash-worthiness, rust-proof, dependable transportation for cheap. We owned three of them. One got smashed between two SUV’s on the highway and my wife walked away.

    Really sad to see the odd collection of cars that are now badged as Saturns. Ever since the “new” V6 engine fiasco for the Vue it’s been clear where the brand was headed. (For those unaware, after two years warranty was so bad on the V6 that they scrapped the line and bought Honda engines.)

    Still, if someone were to champion making plastic paneled, fuel-efficient vehicles for cheap I bet they’d find a market for them. Especially with gas at $4 a gallon. Maybe that’s all that was missing for Saturn to ultimately be profitable: a gas crisis.

  • avatar
    ethermal

    Funny I read a news paper op-ed article back in the mid 90’s about how GM was following in the footsteps of some locmotive manufacterer from the late 1800s. Apparently the train company was the largest in the world at that time and was acting like it was the largest in the world. Here we were 100 years on and that train company was no where to be found. Completely dead and out of business. The article pulled some really good parallels and the take away was clear, change or die. Clearly GM is not changing and they are dieing. To say that no one predicted what is happening in the automotive industry today is absolute rubbish.

  • avatar
    JT

    I have to agree with JK436123…

    Last week, I attended a plant tour in Michigan. The host company provides parts for Saturn products, and we were chauferred to an elegant luncheon in an new Outlook. (nee Acadia/Enclave)

    Walking around it, and then riding in the cramped and plastic-y interior, all I could keep thinking was “Wrong vehicle, wrong time.”

    It had well below 10,000 miles on it; the bezel or trim piece for the door handle fell off the inner door pad as I was getting out. Some things never change.

    JT

  • avatar
    ZoomZoom

    thalter :

    That’s too bad, because the 2010 (there’s that year again) Saturn Aura/Opel Insignia is one sexy ride (Kind of a cross between an Passat and a Jaguar XF). Look for yourself….

    That looks like a BMW. Sure, it looks nice, but I wouldn’t go so far as to call it “sexy.”

    Beyond that, I have to wonder…is there no creativity left in Hollywood or Detroit? We just keep getting recycled ideas. Old comic book heroes, Indiana Jones, and recycled Knight Riders…and cars that look like everything else on the road?

    Except for the Prius, they’re all looking like retreads to me…

  • avatar
    jaje

    Saturn had a good recipe that was ruined by the constant push to bring it “up market” in search for easy profits, and ignorant management that set too high of an expecation of 500k units so quickly (it was set up to fail probably by bickering GM management). GM just didn’t get the fact that building something new takes time, patience, and support.

    If GM kept to the recipe and updated the decent cars they had at the time – Saturn would have continued to grow. Instead they were starved of product and refreshed cars, then given plastic paneled GM cars that did not fit their image, then simple badge engineered Daewoo/Kia (1st Gen Vue) which then they put in a Japanese competitors v6/drivetrain, then they moved Saturn up market with rebadged Opels, etc.

  • avatar
    ttacgreg

    The original Saturn was one of the few efforts GM put out since the “downsizing” effort in the late 70′, that earned any respect for GM, in my mind (other than the ultra niche Corvette)
    Here was a competent, unique, vehicle that was compeditive in its market, maybe not the superlative best, but we are talking Generally Mediocre motors here. To my amazement at the time, it actually got Toyota like top scores for reliability in Consumer Mag’s surveys. Very un GM lke.

  • avatar
    geeber

    Adrian Imonti: Peter Drucker, the father of management consulting, encountered GM’s insularity as early as 1946. His seminal study, Concept of the Corporation, extolled the automaker’s organizational successes, but advocated increased decentralization and empowerment of line workers. Drucker’s questioning of GM orthodoxy was considered blasphemy.

    Great article that is right on point regarding Saturn’s slow death, but, regarding the above quote, I don’t think it’s fair to single out GM management from that time for being insular and arrogant.

    That was a big problem with American business in general at that time. Studebaker, for example, prided itself on its independence from the Big Three. But when Studebaker management was shown a four-door sedan prototype from Porsche in the early 1950s, it dismissed it out of hand, saying that it didn’t need guidance from a “nutty, half-baked industry.”

    We could probably spend hours listing the American corporations that have either disappeared into other companies or gone out of business completely because of management insularity and arrogance. GM has outlived them, primarily because it has been insulated by its size, and that it has made SOME products that Americans want.

    Unfortunately, it looks as though $4-a-gallon unleaded is killing the desire that Americans had for those products (big trucks and SUVs).

  • avatar
    Ingvar

    Saturn was killed by starvation. I guess the new leaders couldn’t kill the brand outright, so they said: “Just let it wither and die.” For nine years, it was effectively a one model brand. And the original S-series soldiered on for twelwe years before it was replaced. Ant the replacements was based on Opel-products. They starved the company to death. Where was the r&d?

  • avatar
    Paul Niedermeyer

    Those that knew me back in the late 1980’s will confirm that I predicted disaster for Saturn from the get-go. I almost thought I was wrong after the first couple of years, thanks to the brilliant marketing/ad strategy of Hal Riney.

    But I knew that trying to fix GM’s deep-seated problems from the “outside” (a new “corporation”) was fundamentally a deep mistake. Change HAD to come from within, and throughout the whole company.

    GM wasted well over $10 billion on Saturn. It will go down in history as one of the great expensive American car flops, like Edsel and Ford buying Jaguar. PULL THE PLUG!

  • avatar
    GS650G

    I bought an SL-1 in the fall of 1991, the dealer just opened and I was literally the first one on my block to have one. Co-workers took my car for test drives in the parking lot, and many bought them. Sure, the car was imperfect with rattles, and there were brake issues and engine mounts ( it is a GM car after all ) but the difference was the dealers had great service and that made a difference.

    The car was reliable, got 40 MPG, handled well, had good ergonomics, and the plastic sides were a good idea, no dents or rust.

    8 years later it was sad to see the company turned into another GM badge engineered project. The original deal to keep the union ws out and it showed. What a shame.

  • avatar
    geeber

    Paul Neidermeyer: It will go down in history as one of the great expensive American car flops, like Edsel and Ford buying Jaguar. PULL THE PLUG!

    The negative impact of Saturn on the parent corporation is FAR worse than that of the Edsel. Ford was never forced to starve its other brands for new product because of the costs associated with the Edsel. The money spent on Saturn was diverted from the other brands, which put them at a serious competitive disadvantage with not only the imports, but Ford and Chrysler. Olds died, Buick and Pontiac are now at death’s door, and Chevrolet and Cadillac still lag the competition in crucial segments.

    Ford bailed quickly on the Edsel, and even used the production capacity it had installed to build the Edsel for the Falcon and the Comet, both of which were solid successes. In retropsect, the failure of the Edsel was a good thing for Ford, because now, 50 years later, if Edsel were still around, it would probably be another near-orphan brand that adds nothing of any real value to the bottom line or the product portofolio.

  • avatar
    Paul Niedermeyer

    geeber: The negative impact of Saturn on the parent corporation is FAR worse than that of the Edsel.

    Couldn’t agree with you more. When the dust settles, Saturn may well turn out to be perhaps the biggest single mistake GM made, because it deflected dealing with their decades-long problem with making successful small cars (which was just another symptom of their profound disfunctionality). And of course, that’s exactly what’s killing them now.

  • avatar

    So GM wants to reinvent Saturn by making it Opel?
    The problem with that: it’s not customer focused. It’s a way to fill Saturn stores on the cheap using existing rebadged vehicles. But what customer problem exactly is solved with that? Are Americans clamoring for Opels? When similar platform cousins can be bought from Chevy?

  • avatar
    lzaffuto

    Exactly. Why create a new brand? Why couldn’t the new Saturn S series have just been the new Cavalier? Why couldn’t they adopt Saturn’s way of dealing with customers for existing GM brands (well except for maybe the no-haggle pricing since some don’t like it)? Why not spend the money and use the good ideas to improve existing brands rather than create a new one? It was really a missed opportunity.

  • avatar
    KatiePuckrik

    The thing which killed GM’s baby was GM itself.

    I’m sure Saturn was borne out of good intentions and a shot at trying to re-invent GM. But, it was only until the next CEO that Saturn would survive.

    This leads onto another of GM’s bigger problems.

    For the last 25 years, GM’s vision (whether they like to admit it or not) has been this:

    Profit, no matter what the cost or measure.

    This is the only explanation for the following actions:

    Buying SAAB.
    Buying Hummer.
    (Attempting to) buy FIAT.
    Pushing SUV’s and trucks despite rising fuel costs.
    Setting up Saturn.

    GM’s continual hunt for profit (no matter how they’re achieved) blinkered it from looking after itself. GM continually went to rack and ruin, but no-one cared, because they kept raking in easy money; so according to GM’s logic “We’re still making money so our company is still in rude health”.

    Now, that the profits have dried up, it’s now becoming apparent how fragile the company is. Lack of investment in R and D, poor line ups and poor quality & reliablity. But, now they have no money to fix these problems, since they are trying to fix other problems like unstable suppliers (i.e Delphi and American Axle).

    Anyway, back to my point.

    It is because of this lack of vision, unwillingness to change and poor planning, Saturn was doomed to fail.

    There’s no way any CEO (outside of Roger Smith) would WANT Saturn to succeed. If Saturn DID succeed, people (i.e Shareholders) would question the management of GM HQ (since, Saturn was supposed to act independently of GM). This highlights another problem at GM’s style of thinking, which is, “Screw the company, what about my career?”. So, GM put GM style management in Saturn and it slowly went downhill after that.

    You can take the brand out of GM…..

  • avatar
    willbodine

    Hindsight being perfect, one can’t help but wonder what would have happened if GM had instead invested the 5 Bill to re-engineer Olds, say.

  • avatar
    whatdoiknow1

    Saturn for GM was like Merkeur was for Ford/ Mercury. Both were actually good ideas brought to market at the right times by companies that were totally wrong for these type of experiments.

    Saturn could have been a success but the entrenched interest at GM; Buick, Chevy, Olds, Pontiac, GMC, and Cadillac had every reason to want ot see it fail.

    Call Roger Smith a dumb a$$ all you want but he did have a good understanding of the problems that were facing GM in the 1980s. Like it or not Olds, Pontiac, and Buick were already dead by the early 1980s. Quite simply these brands were “played out” for far to many potential and NECESSARY costumers that GM needed. The folks that had moved and were moving to imports no longer desired any type of TRADITIONAL GM vehicles.
    IT was NOT just quality, it was the type and fashion of traditional domestic cars that many folks no longer wanted. By 1980 no matter how good a Grenada was built or drove folks that were buying Saabs, VWs, Subarus, Volvo, and Datsuns were NOT coming back to GM or Ford.

    The problem was the market for landau roofed, white walled tired, chome hubcapped, two-toned beast was still rather strong in 1980 and GM could not abandon it then. The management at the various brands still had good numbers to back up their jobs. The old fashion designers still held sway and the dealers had enough tradition costumers that HATED anything that looked Japanese that getting newer “Modern” cars into these brands was a very hard sell.

    Hence Roger and Co creatd Saturn. They did know that one or two of the traditional GM brands were going to bite the dust in the near future and Saturn was meant to be there to fill the void.

    Saturn started with the right idea until GM starved it damn near to death in the 1990s. Saturns current sad state is directly related to the SUV craze and profits of the 90s-00s. The Saturn Ion says it all, a car built with a total “WHO CARES” Attitude.

    Saturn, if done correctly would have been the life boat that is saving GM today. Unfortunately GM just lets its lifeboat rot on deck during calmer seas and does not have a life boat when they need one.

  • avatar
    night driver

    Saturn’s main legacies are that no-haggle pricing and plastic body panels are viewed as failures.

    No-haggle pricing is even more of an albatross for Saturn now that its cars aren’t unique. Why buy an Outlook or an Aura at no-haggle pricing when you can negotiate a better price for an Acadia or a Malibu?

  • avatar
    jurisb

    Saturn is like Nostradamus, verse by verse predicting the future of General Motors. You see, cancer doesn`t kill you in a day, or second like an overboozed texas cowboy who has been given a lesson of politeness. The detroit and the whole American manufacturing business is unable to sustain such a greed without losing focus on main arteries- quality, precision, long term goals.
    While most disagree with me, stating that there is no difference whether you use global platform developed by someone else, or your own one.
    The history teaches us that most british car companies before extinction also used foreign platforms. Usage of foreign platforms is a symptom of engineering disability. And if you are unable, or have to save on platforms, it is very likely you are going to save on rest too.
    The reason US manufacturing is dying is because of lowering standards of engineering. As more and more is outsourced, there is no need for skilled engineers, no engineers, no schools for them, no jobs, no place to build expertize and experience. For 30 % I would blame greedy and shortsighted top executives, another 30 % ( sorry, sorry, please, don`t erase me)I would blame for immigration. another 30% for Us society itself which has lowered standards for manufactured goods thus allowing local Detroit 3 to get spoiled by selling subpar products without a tough competition. 10%- governmental policies, which would rather save companies by injecting money into them, while what is necessary- governments should subsidize good engineering skills and manufacturing discipline. For example automotive engineering degree should be for free.
    And lastly Gm is adopting too slowly( also model generation change is too slow), while it took them to realize that fit and finish matters- about 20 years, it will probably take them another 20, to realize that amenites also matter. Will Camaro have lenses on headlights? remote gas cap? Foldable mirrors? Today customers don`t buy cars just because they have names or round shapes! They want independent suspension, economical engines and reliable parts! bla, bla, bla….

  • avatar
    50merc

    There have been so many costly blunders: Saturn, Allante, Reatta, Aztec, Fiero, Hummer, Vega and others. The cumulative losses on these ill-fated ventures must be in the tens of billions. Yet GM staggers on, like the Black Knight.

  • avatar
    lzaffuto

    “Yet GM staggers on, like the Black Knight”

    LOL, I’m thinking Monty Python. “It’s just a flesh wound!”

  • avatar
    seoultrain

    I’m actually somewhat of a fan of the Opelization of Saturn. It may not be the best move, but it beats what the brand was in the recent past. Like many people here, I believe the problem is GM’s lack of support for Saturn. Few people outside those who keep a very close eye on the car industry know that the Astra and Aura exist. The Sky made a splash, but was quickly forgotten. The Outlook has too much competition with badge-engineered siblings.

    I spoke with a saleswoman at a Saturn dealership about the Astra and its obscurity. She said something along the lines of “Yeah, that’s what always happens. They make a big fuss about an upcoming car and we get a lot of people who show up looking for it, and we have to tell them it won’t be available for another 3 months. Then, by the time the car actually gets released, the hype is dead and those people have since bought something else.”

    Just mismanagement all over the place.

  • avatar
    Wunsch

    I’ve always found the “no haggle, friendly” image that Saturn dealers are supposed to have a bit questionable. The local Saturn dealer here is by far the most high-pressure, unpleasant dealer I’ve ever set foot in.

  • avatar
    amac

    Too bad, the Astra is a pretty decent car from what I’ve heard. Saturn is to GM what Mercury is to Ford… a neglected brand, a missed opportunity.

  • avatar
    Stu Sidoti

    # amac :
    June 9th, 2008 at 9:45 pm

    Too bad, the Astra is a pretty decent car from what I’ve heard….

    True…We had a new 5-door Astra in the fleet last month…Overall, a nice car that felt very solid and mildly impressive…until I strolled around to the window sticker…$21.5K ?!?! Are you kidding me? For that kind of money one could buy a Jetta/Rabbit and have change leftover…and have a something more like a real European car not a warmed over Opel from GM. If you don’t need all the room for the same $21.5K you could get into new Mini-and there’s simply no comparison of the cache’ between an Astra and a Mini. Which one would you buy?

    While today’s Saturn lineup has virtually no common traits tying it together as a cohesive ‘brand’ , GM came close to making a unique brand…at first, I maintain that they did have a ‘different’ kind of car company but they neglected it for nearly a decade-Imagine where Saturn would be today if they had morphed the ‘different kind of car company’ into the ‘Green kind of car company’? What if they had become the home of the EV-1? and it kept being produced and evolved? Imagine if they had a hybrid 5-8 years ago and they evolved it as well? Imagine if they kept going with their plastic panels and evolved that into a full-circle recycling program, much like BMW has today? Just think how they could have been viewed today as an industry and societal leader with a little enlightened leadership, and a lot more ‘ears to the ground’ of what direction American society was headed towards…In the words of Maxwell Smart ” missed it by THAT much”…

  • avatar
    Adrian Imonti

    Thanks to everyone for the comments so far. The story of Saturn is a frustrating one. This should have worked, but it has flamed out just about as badly as it could have. Unfortunately, GM has learned all the wrong lessons from the experience. Another opportunity wasted.

    If I can respond to a few of the comments. My apologies for not having time to answer all of them –

    aje : Saturn had a good recipe that was ruined by the constant push to bring it “up market” in search for easy profits, and ignorant management that set too high of an expecation of 500k units so quickly (it was set up to fail probably by bickering GM management). GM just didn’t get the fact that building something new takes time, patience, and support.

    I have to disagree with you here. I actually believe that the problem is the opposite. Saturn didn’t provide its customers anywhere to go or any thing to trade up to. Although the sales channel was well thought out, the product didn’t get nearly the same attention.

    The brands that prove to be successful in the middle-class price class usually started at the lower end. Over time, they would gradually introduce vehicles that cost more. They use the entry-level cars to build trust with their customers, who are often younger and willing to take a risk with a new badge in order to save some money. As these buyers age and their needs change, they earn more money and add members to their families, at which point they become candidates for larger, more expensive vehicles.

    Saturn left these customers behind. After getting off to a great start, they left them with very few choices and cars that had grown stale. The refresh cycles were too short and new products should have been added. Those customers ended up leaving, and the momentum was lost.

    Saturn ended up getting short shrift because Jack Smith was brought in to turn GM around. They decided that small cars were not going to get them there. The SUV plan worked in the short term, and at the time, Jack Smith was heralded as a miracle worker. Today, I think that we can see that Jack Smith’s plan created only short term benefit and also set up the company for their recent problems. When you want to figure out why GM is totally unprepared for today’s market, Jack Smith and his protege Rick Wagoner deserve all of the blame.

    geeber : I don’t think it’s fair to single out GM management from that time for being insular and arrogant.

    Thanks for the earlier compliment.

    I take your point, in that GM is not alone with the superiority complex problem. However, I would argue that GM is actually substantially worse in this regard than other corporations. Within a historical context, I think that we should remember that GM was not just another company. Not only was it the largest corporation in the world, but it also literally invented modern management practices.

    Arguably, GM was the first company to operate in a methodical manner, compartmentalized and organized around a structured, deliberate hierarchy supported by committees. Today, this sort of structure is common, in companies large and small. But at the time, this was a highly innovative approach that revolutionized modern business. It had worked so well for GM that Drucker’s book was taken as a slap in the face, especially for Sloan because he had used these strategies to save GM from Durant’s failures and to pass Ford to become #1.

    I believe that even today, GM has difficulty getting past the proud but polite arrogance that defined Sloan’s tenure, and that they were much worse than most. Companies like Ford and GE turned to Drucker for guidance, but GM always rejected it, even decades later.

    If you haven’t already, I would encourage you to read Drucker’s book. It’s a bit ponderous and at times, overly theoretical. But read back to back with Sloan’s autobiography, it helps to put it together.

    whatdoiknow1 : Call Roger Smith a dumb a$$ all you want but he did have a good understanding of the problems that were facing GM in the 1980s. Like it or not Olds, Pontiac, and Buick were already dead by the early 1980s. Quite simply these brands were “played out” for far to many potential and NECESSARY costumers that GM needed. The folks that had moved and were moving to imports no longer desired any type of TRADITIONAL GM vehicles.

    I would caution you against giving Roger Smith too much credit. I agree with you wholeheartedly that he was quite right to acknowledge GM’s quality problems, to realize that Toyota had a lot to teach GM, and to recognize that GM would ultimately suffer without a good small car. However, he also blew substantial resources on distracting acquisitions such as EDS, and spent far too much money and effort on automation, when he could have worked on improving labor relations. Smith so loathed the UAW that he invested too much energy in his robots, a decision that literally cost him in terms of cash and product quality. You can like the union or not, but you still need humans to assemble the cars.

    KatiePuckrik : GM’s continual hunt for profit (no matter how they’re achieved) blinkered it from looking after itself. GM continually went to rack and ruin, but no-one cared, because they kept raking in easy money; so according to GM’s logic “We’re still making money so our company is still in rude health”.

    I’d like to amend that point. GM is guilty of continually pursuing profit margin, not profit. These are not quite the same thing.

    Every company pursues profit. If they don’t, they go out of business very quickly. However, GM obviously has a history of coming close to the brink time and time again. I may just have to write an article about this!

  • avatar
    Jonathon

    True…We had a new 5-door Astra in the fleet last month…Overall, a nice car that felt very solid and mildly impressive…until I strolled around to the window sticker…$21.5K ?!?! Are you kidding me? For that kind of money one could buy a Jetta/Rabbit and have change leftover…and have a something more like a real European car not a warmed over Opel from GM.is a real European car, slightly modified to meet US standards and imported straight from Belgium.

  • avatar
    yankinwaoz

    Adrian Imonti,
    Nice analysis. But I have to disagree with you when it comes to giving Saturn customers something to move upscale to.

    That kind of thinking is what is killing GM. Every brand tried to be all things to all people. The upgrade path for Saturn customers should have been Buick, Olds, or Cadillac.

    On the contrary, Saturn should have stuck to its niche and specialized in funky, inexpensive, small quality cars for young or “different” buyers. A lot like Toyota is attempting to do with the Scion brand. If they had done it right, then for every customer that outgrew Saturn, 2 more up-and-coming customers could replace them.

    In other words, Saturn should have been to GM what Apple is to the PC industry.

  • avatar
    chanman

    “Won’t be missed” is one hell of a depressing epitaph

  • avatar
    matt

    I had an ’01 SL1, and I thought it was fine for a small car. Great mileage (hardly ever less than 35 mpg and close to 40 mpg on the highway), dent resistant panels, and decent enough looks.

    However, the engine and tranny were failing at around 100k (could have been because I beat the hell out of it), and I had a piece of plastic, that as far as I could tell, fall off on the highway. It was also really noisy (wind, tire, and road noise), but it should be said that the noise never bothered me. I just realized how noisy it was after driving an S2000 at highway speeds and noticing how quiet it was compared to my car, despite being a convertible. And turning at ~3500 revs.

    If GM could have taken the positives from the SL1 and improved on the negatives, they would have had at the very least a competitive small car.

  • avatar
    roar1

    If GM survives and they turn to their attention to cars then Saturn has a chance. People do not dislike Saturn and what it stands for, the products today are solid and the retailers do take care of their guests. Time will tell but Saturn could be a success story.

  • avatar
    menno

    Surely, GM should have dualled the Saturn and Saab dealers once it bought Saab, enabling people to move up to something more Saturn-like?

    Folks wanting to move up from Saturn probably wouldn’t want to go to GM products just because Saturn was owned by GM, in my humble opinion.

    Oh well, it’s probably too late now, anyway. Too late for Saturn, Saab and soon, too late for GM.

    BTW someone commented that pretty much all cars look alike now except the Prius?

    Well, imitation being the sincerest form of flattery, I was sitting with a Honda salesman (who know I like my 2008 Prius and won’t be selling it any time soon but also knows we’ll be in the market for a car in a year to replace my wife’s leased car) and he showed me an official for dealer use only rendering in color, of the as-yet unnamed Prius competitor coming next year.

    It looked like a current Prius with a Honda grill. It was a 5 door hatchback.

  • avatar
    NickR

    I agree with the sentiment that at least the Saturn, initially, had a distinctive look to it (in a reasonably appealing way) that it has now lost. Which is a shame.

    Surely, GM should have dualled the Saturn and Saab dealers once it bought Saab, enabling people to move up to something more Saturn-like?

    Actually, that’s how the dealers are set up in Canada. In fact they were Saturn/Saab/Isuzu dealers. I think most of them dropped the Isuzu name, leaving them as Saturn/Saab only.

  • avatar
    adam0331

    My mother bought a ’93 SL2 from a female sales person that they were running TV ads about in the early 90’s. Apparently she loved the car buying experience so much she went to sell Saturns.

    At that time most people didn’t even know Saturn was part of GM, especially my mother. She honestly thought that she was buying a Japanese import. Inside it did kinda look like a Toyota, if you looked past the uber cheap plastics.

    100k miles later the thing was on its death bed. Literally falling apart. So I took Mom out to look at cars again. On the list was the new larger Saturn models and well at stop at the Honda dealer and then onto Toyota. After being somewhat satisfied by the 2000 model year offerings of Saturn she drove the Accord and bought it on the spot without even testing the Toyota lineup.

    Never in the realm of thought was other GM offerings like Chevy, Buick, etc. Mom had a crap Olds in the 80’s and wasn’t going back to them. Still contend that GM was onto something making a car that people didn’t know was GM…their failure was not improving the brand. If the new Saturns could compete with the Honda they might have sold one more.

  • avatar
    brettc

    There was a Saturn dealership in Brunswick, Maine for the 7 years that I’ve lived in this area. It’s now a Hyundai dealership.

    A friend’s mother had 2 Saturns. I rode in her SL2 a few years ago and it seemed like a decent car overall. If GM were to update the SL1/SL2 designs and fix the problems that plagued those models, they might actually be able to offer an economical small car that people want to buy. Evolution, not revolution. I just don’t get why GM brings out so many new models. But I guess they have to change the names to make people forget what POSs the defunct models were.

  • avatar
    Jonathon

    Whoa, what happened to my last comment? It should have read, “Uh . . . the Astra is a real European car, slightly modified to meet US standards and imported straight from Belgium.”

  • avatar
    Axel

    RIP Cheap, reliable, efficient transportation.

    My parents gave me an $11K, 1999 Saturn SL as a college graduation present. Nine years and 181K miles later, it shows no sign of stopping, and has required nothing more than tires, brakes, one clutch, and a new set of fuel injectors. It STILL gets 40 MPG on long road trips (down from 43-44 in its heyday). I can still (thanks to the manual 5-speed) get from 0-60 in under 9 seconds.

    Inflation adjust that for today. Name me a $15k compact (NOT a cramped subcompact) that runs forever, gets 40+ highway, and isn’t a total cheap piece of junk. The Corolla and Civic have blinged and bloated themselves up $3K and down 5 MPG. The Yaris is a cramped subcompact. The Cobalt is a joke. The Versa gets worse mileage than a Civic. The Rio/Accent comes close, but then again, the mileage thing. Any Fit you can find is going to run well over $16K.

    Can you imagine if Saturn stuck to what it was doing, and today had an updated, evolved version of its 1999 lineup? Decent, reliable, efficient transportation? Cars with NEW EPA ratings of 40/30? They’d be selling cars as quickly as they could make them. The SL, rather than the Civic, would be America’s #1 car. No question.

    (To bolster my point: in the past year, the KBB of my 1999 SL has doubled from $1250 to $2500. And I ain’t giving it up even for that price.)

    But then, that would require strategic planning and an attention span longer than a financial quarter.

  • avatar
    Gottleib

    adam0331 said …” she drove the Accord and bought it on the spot without even testing the Toyota lineup.”

    I don’t have proof but from my personal observation of the way people purchase their cars there are a lot of purchase decisions made based on what the neighbors/church members/work associates/family members drive. When the mini-van came to market in the 80’s it didn’t take long before we had one, the neighbors had one, and the church parking lot was filled with them. In the 90’s it was SUV’s and now I notice quite a few Toyota and Hondas populating the parking spaces and driveways which were one home to the SUV and mini-vans.

    This is to say that the vast majority of the car buying public does not make their purchase decision solely on the features of a particular make and model as we car-types do. Rather there are the influences of their social circle and people within their social network. That being said, those of us that know and love cars may have influenced others in ways that we are now beginning to regret.

  • avatar
    John Horner

    Saturn, like almost all of Roger Smith’s ideas, was a bad idea from the start and has only gotten worse over time. All of the capital to start Saturn came at the expense of the existing brands. GM needed to build great cars to compete with Toyota … but they didn’t need to start another division. Many tactical errors have indeed been made along the way, but the core problem is that the strategy was flawed from the start. GM needed to compete with imports, true. But creating a special division to do so missed the point.

    United Airlines and Delta both recently tried the same bone headed idea. The opened new divisions (Ted and Song) to compete with discount airlines. Both efforts are now dead. The time, money and people which were wasted on Ted, Song and Saturn will never come back. Nice work MBAs!

  • avatar

    jaje had it exactly right so I’m just going to quote:

    Saturn had a good recipe that was ruined by the constant push to bring it “up market” in search for easy profits, and ignorant management that set too high of an expecation of 500k units so quickly (it was set up to fail probably by bickering GM management). GM just didn’t get the fact that building something new takes time, patience, and support.

    If GM kept to the recipe and updated the decent cars they had at the time – Saturn would have continued to grow. Instead they were starved of product and refreshed cars, then given plastic paneled GM cars that did not fit their image, then simple badge engineered Daewoo/Kia (1st Gen Vue)

    Given that the one design of the original made it almost to 300,000, that showed it was a very successful idea. Nothing since has come close. My understanding was Roger Smith’s original idea was to watch Saturn, and gradually remake GM in Saturn’s image.

  • avatar
    vento97

    ZoomZoom:

    is there no creativity left in Hollywood or Detroit?

    You can add the “music” industry into the mix…

    The pool of originality has dried up many years ago….

  • avatar
    Spaniard

    I am a Spaniard.

    I knew about Saturn trough the Net a few years ago. I have never seen a Saturn in the flesh, only pictures. I am a “virgin” regarding the reliability and handling of those cars. I know only about the looks.

    I must say those cars (Saturns from the 1990s) seem to my european eyes esthetically very, very attractive. Just the “high-tech” image that Citroën used to cultivate (DS, GS, CX…) but without (AFAIK) the complexities with which Citroën overburdened those cars.

    Plastic panels…just brilliant.

    I would be interested in cars with that look.

    It´s a pity this brand is going down the drain.

  • avatar
    Geotpf

    Saturn didn’t work, and never will, because there was no way for an entire seperate dealer network to become profitable for selling one car, and once you’ve convinced the world that Saturn=Plastic Corolla Clone, you can’t turn around and start selling $35,000 SUVs (especially if you won’t haggle and people can buy the same damned vehicle down the street at the GMC dealer that does haggle).

  • avatar
    Adrian Imonti

    I’ll try to catch up with a few more of these –

    Paul Niedermeyer : GM wasted well over $10 billion on Saturn.

    It’s hard to put figures on it. I’ve never found an official accounting of it, and I doubt that I ever will. The best estimates I can find was that Roger Smith’s startup costs were about $5 billion. Since then, Alex Taylor of Fortune estimated back in 2004 that the total tab at that time was about $15 billion. So who knows, maybe we’re up to $16-17 by now?

    jurisb : The reason US manufacturing is dying is because of lowering standards of engineering. As more and more is outsourced, there is no need for skilled engineers, no engineers, no schools for them, no jobs, no place to build expertize and experience.

    To be frank, I don’t see any proof of this at al But in the case of General Motors, there has been a decline, and the reasons go back to Alfred Sloan. When Sloan became CEO during the early 1920’s, GM was at the brink of failure and lagged well behind Ford. Sloan revolutionized the business by prioritizing styling and market positioning over engineering. Sloan managed to quietly kill off early GM experiments with air cooled engines, worked with Du Pont to add color to the bodies, and differentiated the brands based upon pricing tiers and style.

    This lesson stayed with GM throughout Sloan’s leadership. I believe that this attitude lingers until this day. They believe that American consumers are uninterested in engineering advances, so they do not want to invest the money to provide them because they do not believe they will gain from the investment. Obviously, this attitude is wrong, but old habits die hard.

    John Horner : Saturn, like almost all of Roger Smith’s ideas, was a bad idea from the start and has only gotten worse over time. All of the capital to start Saturn came at the expense of the existing brands. GM needed to build great cars to compete with Toyota … but they didn’t need to start another division. Many tactical errors have indeed been made along the way, but the core problem is that the strategy was flawed from the start. GM needed to compete with imports, true. But creating a special division to do so missed the point.

    It’s easy to criticize Roger Smith for his failings. Hell, I just spent 800 words doing it. But a little historical context is in order here. When Smith started Saturn, GM had had one failure after another in building a successful small car. The failures were expensive and disastrous for the existing brands.

    Smith faced a couple of serious challenges. There were brands that had lost substantial value with notorious, well publicized failures. Not only that, but a lot of the problems were due to the bureaucracies across GM and how they interacted with each other. The track record of failure within the divisions was substantial and costly in terms of both cash and brand equity. A new brand was probably necessary just to get consumers to look at the cars, and an effort needed to be made to remove the usual fiefdoms from the design process.

    Smith made a lot of errors, no doubt. But working within the existing organization had also failed. Reinventing the existing brands would have been easier said than done. The legacy of General Motors has left a massive web that remains difficult to mend. To this day, no one has really found a solution. Amazing, when you figure that they have had forty years to get one.

    David Holzman : Given that the one design of the original made it almost to 300,000, that showed it was a very successful idea. Nothing since has come close. My understanding was Roger Smith’s original idea was to watch Saturn, and gradually remake GM in Saturn’s image.

    The 500k sales target wasn’t entirely arbitrary. The sales level was needed to turn a profit. In this market, it’s really impossible to sell 500k of any single car. Saturn would have needed two or three successful vehicles just to hit this number. That alone was reason enough to add another vehicle. Otherwise, there was not much reason to start a brand to sell a single vehicle.

  • avatar
    vento97

    jurisb : The reason US manufacturing is dying is because of lowering standards of engineering.

    …combined with a heavy dose of MBA-induced beancounterism…

  • avatar
    adam0331

    RIP Cheap, reliable, efficient transportation.

    I can’t completely disagree with Axel. Had the compact Saturns of the 1990’s been upgraded just enough to compete with the Civic & Corolla of today they’d be selling, but only because of high fuel prices.

    I still contend that a large portion of their original customers bought because they didn’t know Saturn was GM. 10-15 years later it’s hard to hide that fact and the bad stigma of GM is hard to shake. The only people I know that drive domestics are either retired or drive company fleet vehicles. Saturn was a good way to dupe people into buying a domestic and could actually change GM bias if the cars were better than the foreign competition. Sadly, they weren’t.

  • avatar
    John Horner

    Adrian Imonti :The legacy of General Motors has left a massive web that remains difficult to mend. To this day, no one has really found a solution.

    Good point, and we can never know what happened in alternate universes where different decisions were made. In this universe we know that Saturn was created as a desperate attempt to start over and that it didn’t work out. We also know that the other GM brand problems never got sorted out. My position is that in the 1980s, as now, the last thing GM needed was yet another brand to attempt to differentiate and sell.

    Also, the original Saturn cars were perhaps marginally better than the Vega and Chevette, but they were still nothing special.

  • avatar
    ttilley

    whatdoiknow1: Saturn could have been a success but the entrenched interest at GM; Buick, Chevy, Olds, Pontiac, GMC, and Cadillac had every reason to want ot see it fail.

    As I remember it, Saturn, and the purchased EDS, came about because Smith wanted to show the entrenched interests what’s what. Which, of course, means I agree Smith had some idea of what was wrong, but it also means I think he lacked the willingness to take constructive action about it. The entrenched interests were his salaried employees, whom he was free to unentrench, if he was willing to take a risk on the reasonableness of his own diagnosis of GM’s ailments.

  • avatar
    Anuerysm_Boy

    To paraphrase our esteemed Commander in Chief: “GM, yer doin’ a heck of a job!”

    Brilliant plan to kill any nuggets of goodness that you might possess. Like Saturn. And Saab. Yeah, just sit by idly and allow those brands to wither on the vine, but please do keep filling up your dealer lots with more of those oh-so-desirable and oh-so-profitable (thanks to very little R&D work needed, ’cause it’s Same Shit, Different Day) SUVs.

    Good night, GM…


Back to TopLeave a Reply

You must be logged in to post a comment.

Recent Comments

  • ravenuer: You forgot…”and get off my lawn!!!..
  • Scoutdude: Interest rates have everything to do with leases. They may call it a money factor to through off the less...
  • HotPotato: How big is this thing? The styling makes it look at least Camry size if not Avalon size. But then you...
  • HotPotato: Weird that the optional hybrid powertrain yields no discernible gain in combined MPG (gains one MPG in the...
  • HotPotato: You’re confusing “the actually existing pickup and SUV market” with “a few buddies...

New Car Research

Get a Free Dealer Quote

Staff

  • Contributors

  • Timothy Cain, Canada
  • Matthew Guy, Canada
  • Ronnie Schreiber, United States
  • Bozi Tatarevic, United States
  • Chris Tonn, United States
  • Corey Lewis, United States
  • Mark Baruth, United States
  • Moderators

  • Adam Tonge, United States
  • Corey Lewis, United States