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Today’s Auto Dealer Revolution Traces Back to Saturn

Today’s Auto Dealer Revolution Traces Back to Saturn

It was billed as “a different kind of car company.” In lasting ways, it was.

Mistakes were made during the came-and-went General Motors experiment called Saturn.

For one thing, the brand didn’t knock the world over with great products. Until the end (when it was too late), Saturn cars were so-so, some worse than that. The Ion, for instance, was out of this world in the worst way.

But in some ways, the departed brand provides a lasting legacy. Saturn, which opened for business in 1990, changed auto retailing in three ways.   

Firstly, most of today’s automakers and their dealers strive to provide a superior customer experience. It’s part of an ongoing auto-retail revolution. It wasn’t so much the case until Saturn arrived, heralding itself as “a new kind of car company.”

Not every dealership is perfect today. But they sure are trying harder than before. Treating shoppers right has become an auto-retailing mantra. Saturn got that rolling by vowing to make car buying pleasant, not painful.

Dealers on board with that today include Lisa Copeland of Fiat of Austin (TX) who employs a “chief happiness officer,” and Eric Savage of the Freedom Automotive Group in Texas who says he’s in the “life-improvement business.”

Also in that customer-friendly group is California dealer Shaun Del Grande of Del Grande Dealer Group. Its marketing message: “Don’t just be a car buyer, be a happy car buyer.”

A lot of people opt to become the latter; the Del Grande’s organization, No.61 on the 2016 WardsAuto Megadealer 100, sold nearly 40,000 vehicles last year.     

A second way Saturn revolutionized auto retailing was by becoming the first dealership network of so-called one-price stores.

Surveys indicate car shoppers disdain negotiating prices. They find it daunting and needlessly time-consuming. More and more dealerships have become one-price operations, or something close to it.

Even for stores that negotiate price, the range has narrowed – usually involving hundreds of dollars, not thousands – and the process is much quicker.

That’s partly because of Internet-inspired pricing transparency and the ease by which consumers can learn average transaction prices online. Millennial car shoppers, their ranks growing daily, hate to sticker dicker.

But Saturn offered no-haggle prices before a lot of them were born. The brand immediately became known for that. Saturn was on to something.

The third way Saturn revolutionized auto retailing was by offering dealer territories, rather than individual sales points, cutting down on internecine warfare among same-brand dealers.

In similar fashion, Kia just awarded Galpin Motors (No.52 on the WardsAuto Megadealer 100) a three-point sales territory in Southern California.    

Telling me about it in Los Angeles, Brian Allan, Galpin’s director-business development, recalls how Saturn developed the territory system.

“Saturn was really innovative,” Allan says. “Roger Smith was really forward- thinking.”

Allan is referring to the GM CEO who spearheaded Saturn, but perhaps is best remembered as the elusive auto executive in Michael Moore’s 1989 movie “Roger and Me.”

Looking back, Smith’s brainchild named Saturn was too ambitious of a project. That’s because everything was new: the product, the Tennessee assembly and powertrain plants (where workers had their own union contract) and the 350-store dealer network.  

GM calling Saturn “a different kind of car company” was catchy and true. But the special treatment stirred resentment among other GM divisions. It also rankled other GM dealers who thought the tagline implicitly made them look bad.

The late Nat Shulman, a Chevrolet dealer, resented Saturn from the start.

He told me back in the late 1990s: “When they came up with ‘a different kind of car company,’ Chevy dealers were asking, ‘Is that supposed to mean there’s something wrong with us?’”

A few years later, he told me: “I’m still waiting for Saturn to make money.”

Ah yes, that. Saturn was innovative and its cars were popular with certain buyers. But it didn’t meet sales goals and it tended to cannibalize other GM brands.

When the Great American Recession hit in 2008 and GM went bankrupt the next year, Saturn was among the casualties. For a while it looked like dealermeister Roger Penske would save it, but that didn’t happen.

George Nahas was among Saturn dealers who found themselves store-less. He had been an Oldsmobile dealer for years. When GM killed Olds in 2001, it awarded Nahas two Saturn stores as a form of compensation. He hit 0-for-2 in franchise at-bats.

Another Saturn dealer was Todd Ingersoll. He opened Saturn of Danbury (CT) in 2008. About a year later, he shuttered it. Stunned and scrambling to find a new use for the facility, he told me back then, “We didn’t really do our homework there.”

The end of Saturn, the brand intent on delivering a great customer experience, was a bad dealer experience. Still, the initiative taught the industry a lot.

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