Saab Became Sob Story for GM

Saab’s 2008 retail registrations were only 17,376, less than 1% of GM total sales.

Steve Finlay, Senior Editor

June 18, 2009

2 Min Read
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General Motors Corp. can do without its Saab brand, but the same might not be said for Pontiac, says Jeffrey Anderson, director-consulting and analytics for data firm Experian Automotive.

“Saab wasn’t bringing a lot to GM, but Pontiac, as well as Saturn, are as big as some stand-alone auto makers,” he tells Ward’s, citing sales figures.

GM is shedding all three brands. The struggling, bankrupt auto maker is selling Saab Automobile AB to Sweden’s Koenigsegg Automotive AB, a low-volume producer of luxury sports cars.

Meanwhile, GM is killing the Pontiac division and selling its Saturn non-manufacturing operations to Penske Automotive Group.

“It’s an interesting decision to kill Pontiac, considering it makes up 8% of GM sales, compared with 6% for Cadillac and 5% for Buick,” Anderson says. “Why eliminate Pontiac over Buick?”

One reason might be customer loyalty. More than 58% of Buick owners return to a GM brand to buy a new vehicle, the highest percentage of all GM divisions.

Saab is a different matter. Its 2008 retail registrations were only 17,376 last year, less than 1% of GM total sales. In the last two years, Saab sales in the U.S. have dropped more dramatically than the industry as a whole.

Of all GM brands, Saab has the lowest number of customers (34.8%) that are loyal to the corporation. Less than 20% of Saab owners buy another Saab when returning to the market for a new vehicle, according to Experian. About 9% end up buying a Toyota and 8.5% a Honda.

GM debuted ’10 Saab 9-3X at New York Auto Show but has run out of cash to launch next generation of Swedish brand vehicles.

“Saab owners are least likely to return to a GM vehicle,” Anderson says. “Saab just wasn’t bringing a lot to GM. Not now, not 18 months ago.”

Moreover, many Saab sales were because of hefty incentives or sweet lease deals, he says. Such financial lures might be worth it if Saab buyers under those circumstances remained as GM customers.

“But most didn’t,” Anderson says. “They just came in for the deal. If you are using incentives like that to buy a one-time customer, it’s not worth it.”

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