Roger Smith Was Right

Columns From: 6/1/2000 Automotive Design & Production, , Editor-in-Chief from Gardner Business Media, Inc.

 I’m moderately perplexed to see that General Motors is going to invest some $1.5-billion into Saturn Corporation.

 I’m moderately perplexed to see that General Motors is going to invest some $1.5-billion into Saturn Corporation. Much of the money is to be spent on plant and equipment, both to get the Spring Hill Assembly operations in shape to build a sport utility vehicle (SUV) and other vehicles, and for the Spring Hill Engine plant to have the capability to produce a 2.2-liter, four-cylinder engine.

When Roger Smith launched Saturn (remember: this was back in the day when NASA rockets were still an event, not something that garners about as much interest as the running of an inter-urban bus system) he said the goal was to be competitive with the Japanese automakers, which were, at that time, kicking the collective assets of the then-Big Three.

The products that initially rolled out of Spring Hill weren’t world-beaters per se, but their polymer panels and competitive pricing procedures were helpful enough to get customers into the showrooms. And the Saturn stores, which were all greenfield sites (as Spring Hill had been) with well thought out architecture and layouts (not the personal taste of a run-of-a-mill entrepreneur who prefers plaid on pants and knotty pine in building materials) resulted in a revolution of which showrooms must be.

The first Saturn rolled out of the plant on July 30, 1990. By 1992, J.D. Power & Associates named Saturn as Best Domestic Carline in Customer Satisfaction—and it came in third in the overall Customer Satisfaction Index. Third? Yes. Behind Lexus and Infiniti. But the Little Car That Could didn’t relent in its efforts: By 1998 it had racked up four straight wins in the CSI. It beat the Japanese (and European) luxury brands. Now the only way domestic car companies can get in the game is to buy (or be bought by) a luxury brand.

But what did the General do for Saturn? Some people—both GM employees and car magazine writers—would argue that GM permitted it to exist—“Which was more than it deserved!” they’d shriek with veins in their foreheads and necks throbbing. Through the early years, whenever I’d talk to people in either category—especially the former—the rant would be about how GM had sunk too many billions into Spring Hill, money that would never be recouped. Yes, if you run the numbers on the amount of money spent on designing and engineering the cars as well as on building the integrated manufacturing facility—a plant that was certainly a model not only for the early ‘90s, but for years to come—it is clear that there would have to be the entire population of a major state rolling around in SL1s, SL2s, and SWs to make the investment sound vis-à-vis iron—er, plastic and aluminum—off the lots.

The problem that the auto writers had with Saturn was that the car was underpowered, noisy, etc., etc., etc.

To look at the latter first. That’s right. The Saturn wasn’t as good as a Civic. And it isn’t as good as the Civic. I’ve owned both. But what those writers failed to realize is that the customers—the people who actually open up their checkbooks and secure loans that they have to pay off month after month, people who don’t get to periodically “test” cars only to trade them in for others (sort of like the GM executives that were so soundly excoriated for having their cars serviced in the garage of the former headquarters building such that they (a) didn’t realize how crummy their cars really were and (b) missed the whole initial influx of the Japanese models)—liked the damn things, vide the J.D. Power returns.

And as for the GM folks who were so torqued by the investment in Saturn: Realize that Saturn was the best thing that the corporation had going throughout the ‘90s. There was certainly some fine technology that came from Saturn engineers—especially in the area of powertrain design and manufacture—that could have been capitalized upon better than it had been. And although there was a certain bitterness with the possibility of having one’s division “Saturnized,” the resistance was ridiculous: What other GM brand had the loyalty that would have thousands of people show up at any other factory over a weekend for a long picnic, as people did for the Saturn Homecoming? So GM didn’t invest much of anything in Saturn, and the cars went stale.

Saturn sales are down. The small car market is being dwarfed by the big and bigger trucks and SUVs. The bigger Saturns (L series) aren’t taking off. Maybe it is a matter of everything having its season. And that of Saturn may now be passed.

Which makes the $1.5-billion investment now somewhat curious. For the corporation that is ostensibly operating at Internet speed, GM seems to be about five years too late.