Saturn now becoming a division of GM

Discussion in 'General Motoring' started by Oppie, Feb 4, 2004.

  1. Oppie

    Oppie Guest

    I read in the morning paper that Saturn is now going to become a part of GM
    proper. Now to be the Saturn Division of GM and will have to accept the
    operating procedures of the corporate structure.

    It was claimed that Saturn's designs were becoming stale (I don't see it
    that way - how long did the VW beetle stay on the market with only minor
    tweeks?). Besides, Wasn't the 'New kind of car' supposed to buck the trend.
    Now it looks like more of the same...

    Let's hear your opinions.


    NASHVILLE, Tenn. -- Saturn, once billed as "a different kind of company"
    making "a different kind of car," is losing its distinct identity and
    becoming just another division at General Motors Corp.
    GM is forcing Saturn to adopt common practices for design, production and
    labor, a change that had to happen, analysts say, to cut costs and make
    Saturn competitive.

    Saturn officials are downplaying the changes -- "We simply negotiated a new
    (labor) agreement," Saturn spokeswoman Sue Holmgren said -- but analysts see
    it as the end of Saturn as an separate entity.

    The Saturn Corp. was an experiment launched in 1990 to compete with low-cost
    imports like Toyota, Honda and Nissan. All the cars were made in the small
    town of Spring Hill, about 30 miles south of Nashville, and more
    importantly, about 500 miles away from Detroit.

    The company had its own managers who reported to the Saturn executive board
    rather than to GM, and the United Auto Workers signed a separate contract
    with GM to create a cooperative environment between labor and management.

    The cars -- there was initially only one model -- were offered at a fixed
    price, with no haggling. The company developed a reputation for customer
    loyalty that rivaled higher-priced brands.

    Cris Thomas, who runs the computers at a private school in Cambridge, Mass.,
    is on his third Saturn and has put down a deposit on the new Ion sedan
    without even a test drive.

    "I've got to have the Ion," Thomas said. "I'm attracted to the vehicle. I
    like the looks of the older S series, especially when compared with Honda
    and Toyota. I think Saturn is more reliable than the Japanese cars."

    But after a promising start, Saturn let the car's look and technology get
    stale, said Mike Wall, an analyst for SCM Worldwide in Farmington Hills,

    "Saturn's coup and sedan stayed on the market a lot longer than they should
    have," Wall said. "Automakers get bursts of activity by tweaking the design,
    but that didn't happen with the Saturn S series."

    New models were finally introduced to mixed results, and the company has
    plans for more, including a minivan, a sport utility vehicle and possibly a
    sporty coup or roadster.

    Production of the new Relay minivan will begin next fall, but not in Spring
    Hill. Instead, it will be assembled at GM's plant in Doraville, Ga., using a
    standard GM frame.

    "Flexibility is king," Wall said. "You've got to have flexibility of
    production in the current market. This isn't a bad sign for Spring Hill ...
    GM isn't turning away from the Saturn brand -- it's injecting more

    Another sign of change is Saturn's new contract with the UAW, which was
    approved last month.

    "It's a major stride for management and the union," said Laurie Felax, vice
    president of Harbour & Associates in Troy, Mich., who tracks the auto
    industry. "Saturn's plant in Tennessee needs to be as competitive as any in
    the world -- that's how you secure jobs."

    The contract calls for workers to receive a $3,000 bonus now and a 3 percent
    performance bonus to be paid next year, in addition to a 2 percent raise in
    2005 and a 3 percent raise in 2006.

    But the union also agreed to a transition to the national labor agreement
    with GM that would allow the company to lay off employees for the first time
    in its history. Workers approved the contract 2,953 to 317.

    "I believe the contract will maintain our strength and the future of
    Saturn," said Rick Martinez, president of UAW Local 1853 in Spring Hill. "It
    allows GM to be confident in our structure -- it's not dissimilar how they
    operate other GM facilities."

    As part of the deal, General Motors promised to invest $90 million in Saturn
    for capital projects to help boost faltering product lines.

    "They committed to seek significant improvements at the Spring Hill facility
    that will allow us to build multiple product lines, including non-Saturn
    products," Martinez said. "We can built other cars if that's what it takes
    to keep membership secure."

    GM wants to create a global network of flexible manufacturing plants based
    on common practices to let the automaker shift production of different lines
    and models to various factories as needed to match the competitors,
    especially the Japanese companies, Wall said.

    To survive, Saturn had to become part of this strategy. And for the union,
    it was adapt or die.

    "We didn't want to put all our eggs in one basket," Martinez said. "I don't
    think Saturn is being folded into another brand. I think we'll continue as a
    unique facility that allows union participation, but it won't be the 50-50
    partnership we had before."

    Last year, Saturn represented only about 6 percent of the GM vehicles sold
    in the United States, and it has made money in only one of the last 13

    But, said Felax, the analyst from Harbour & Associates, "GM has just as much
    ability to be competitive in this market as anyone."

    Copyright 2004 Associated Press.
    Oppie, Feb 4, 2004
  2. Oppie

    GHOF Guest

    I believe that it was in Automotive News that I read that Saturn will replace
    Olds in the lineup - not carwise, but the fifth division.

    And that the Cavalier will move to the Ion platform.

    And, so it goes!

    GHOF, Feb 4, 2004
  3. <snip>

    I was always intrigued by the whole Saturn campaign. In the beginning when
    a number of cars were shipped with contaminated coolant and Saturn actually
    took responsibility and replaced the cars. I'm sure that if that had
    happened to some Chevy's, that GM would have fought the definition of
    'contaminated' in the courts for years,and eventually would have agreed to
    offer a free gallon of coolant with every new engine that had to be
    replaced. (engine replaced at owners expense of course..)

    I think they got the reliability factor pretty close to a Japanese auto. I
    bought my 95 SW1 with 135,000 miles on it, it now has 167,000 on it and has
    only had three repairs, all minor. (Belt tentioner, thermostat, oil
    pressure switch). The interior has stayed pretty solid, no broken knobs or

    Now that GM is calling the shots, the bean counters will gladly dictate
    cheaper components since that will improve the bottom line by Thursday at
    2:00, rather than thinking of long time customer satisfaction.

    I, for one, will probably not buy another one.

    FWIW, my Japanese reference is my Wife's Acura 1993 Integra. Bought new in
    1993. I have changed two light bulbs, a few sets of brakes, two timing
    belts, an exhaust, and a radiator and hoses. 225,000 miles on it. Original
    starter and alternator, calipers, and such.

    David Teichholtz, Feb 4, 2004
  4. Oppie

    Brad Bishop Guest

    I'm probably going to move to the Toyota line when I'm done with my Saturn.
    The service that I've received with my current (and second) Saturn has been
    pretty poor. It's not at all like it used to be for the first Saturn (8
    years of great service). Now Saturn is just a regular old car company (like
    anybody else).

    Brad Bishop, Feb 5, 2004
  5. Oppie

    skipcar Guest

    Actually, Texaco paid for the was their bad coolant. I think too
    much is being made of this. Saturn has always been a "division" of
    GM...just not in marketing.
    skipcar, Feb 5, 2004
  6. Oppie

    skipcar Guest

    Actually, the Ion was built on the GM "Delta" architecture. That same
    architecture will be the basis of the new Chevy Cobalt (Cavalier
    replacement). By the way, Chevy's new Equinox will be built on the same
    architecture as the VUE...and will look better doing it. It saddens me that
    my 1993 SL2 was probably the peak of Saturn design.
    skipcar, Feb 5, 2004
  7. It always was GM...

    GM engineers, bean counters, materials, etc. roped into competing with the
    foreign small car makers under a clever new name and lots of pr schmooze.
    Earlier tries with small cars manufacturing were pretty sad, and I think
    they finally got the idea that a small, inexpensive car doesn't equate with
    shoddy quality. Look at Honda's - the least expensive car they make seems
    to have as good as build quality as their most expensive, just with less
    features. Visually Japanese cars can't compete (in my opinion) with
    American and European designs. I do like the S2000's lines and the Element
    is growing on me - the rest is plain ugly.

    Hopefully GM learned something that will benefit the other lines - I still
    think their customer service rocks. I'm with you and the Beatle analogy. I
    thought the S-Series could really be refined and endure, but that didn't
    seem to be in the cards... Heck, I'd settle for a Saturn pickup but that's
    not happening either. Oh well, the Toyota Tacoma is built here in
    California in the GM/Toyota facility so at least some of my money would go
    in the accounts of American workers.
    Jonnie Santos, Feb 5, 2004
  8. Oppie

    marx404 Guest

    It seemed to be in the cards. Our local WPB, FL dealership has been going
    thru a buy/sell for the past year and is running itself into the ground.
    They have no more used cars on the lot where there were many, and few new
    cars in the showroom. Management and floor salespersons have begun to act
    just like any run-of-the-mill GM or used ford salesperson, it is sad and

    My family has 3 saturns and we have been loyal customers since 93. We have a
    favorite service tech that has gone out of his way to treat my family like
    his own and that is the main reason that we are saturn people.
    Unfortunately, because things are getting so ugly there we may lose him and
    that will be the end of our relationship.

    I have been eyeing Ford and Hyundai, they have worked hard to build their
    reputation up in the past few years. The focus SVT line(which is european
    design), Tiburon and XG's have built an excellent reputation for themselves
    both with standard and aftermarket owners. (and the new 'stang makes me

    Its too bad that Saturn only relied on word of mouth and the occasional
    cutesy TV ad, there were alot of good thing going for them that the rest of
    GM never had. Too bad also that they foolishly discontinued the S line and
    came up with the ever so boring jellybean-shaped ION. If the Redline had
    come out to immediately faze out the S series, then that might have had a
    positive effect on sales. But it seems the pencil-pushers took over and
    customer service, ergonomics and design have taken a back seat to the bottom
    line, $$$.

    I have absolutely no qualms over considering a foreign car if this is the
    precedent we 'merkuns feel is acceptable. Makes me ashamed and angry, but
    I'll be dammed if I will support bad marketing and management decisions with
    my money.

    Buy foreign, work local, Outsource Bush! ;-)

    marx404, Feb 6, 2004
  9. Oppie

    Steve Guest

    Can you explain how you enhance the bottom line $$$ by driving away your
    customers? I seem to have missed that part of the curriculum in my college
    business classes. ;)
    Steve, Feb 6, 2004
  10. It is simple. You make a decision that will save money immediately, without
    thought to the to following quarter or year. Example, fire 75 % of the
    customer service people and parts warehouse people. Immediate savings to
    the bottom line. In a few months, the terrible customer service and
    terrible repair experience (waiting days or weeks for parts) will catch up.
    But by then the MBA equipped executives have received their bonus and moved
    on to the next company.

    I own several Dell computers, but after the last service experience I will
    never buy one again. I'm sure that I am not the only one. But Dell saved
    $$ last year by outsourcing to people who don't know what a computer is, but
    can almost read a script.

    David Teichholtz, Feb 7, 2004
  11. Oppie

    BANDIT2941 Guest

    I own several Dell computers, but after the last service experience I will
    I have found most tech support lines to be totally worthless nowadays.
    Especially now with the outsourcing to India and other places. Its not like
    "back in the day" when you actually had a shot at getting someone who knows
    what they're talking about on the phone. Now they are reading out of a
    database. In some cases(ie, Microsoft) theres no sense even calling, as the
    database they would be reading out of is probably the same tech support
    database found on their website. Luckily I build my own computers and know how
    to fix them.....
    BANDIT2941, Feb 8, 2004
  12. Oppie

    Steve Guest

    If what you are saying were true, then GM or Dell or whomever would just
    fire or lay off everyone (except, of course, the senior executives), not
    just 75% of the customer service and parts warehouse staff. For most
    companies, that would result in very significant cost savings and thus make
    the bottom line look phenomenal. Until, of course, the following week!
    Seems to me that there's more going on than just a wish to maximize the
    bottom line *today*. If what you're saying is that managers and executives
    don't always strike the right balance between customer service and payroll
    expenses, then I would tend to agree. If what you are saying is that
    managers and executives are all too stupid to understand that customer
    service is important to the success of a business enterprise, then I think
    you've met enough of them.... :)
    Steve, Feb 9, 2004
  13. Oppie

    Steve Guest

    Sorry, that last line should read, "you've *not* met enough of them.
    Steve, Feb 9, 2004
  14. As of last week, the GM plant in Spring Hill, TN is now known as The Spring
    Hill Assembly Center.
    It is no longer refered to as the Saturn Plant....the change has come.

    Seamus' Stuff, Feb 10, 2004
  15. Some day this bitching and moaning will come to an end.

    I had a 1999 SC-2 that was great up to the day of its destruction. About a
    year after I got it new, I started feeling I was in a car too small. The
    car protected me in a four car crash. The car never gave me any troubles.

    The second Saturn an L200 2001 model was a disaster from the start. I had
    several steering components replaced under warranty. Today, I heard a
    familar sound of Steering gear or rack problem. I hope it was only a one
    time event. I have 68,000 on it now and I've been OK for the last 28,000
    New & Improved - N/F John, Feb 13, 2004
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