Saab: GM Starting “To Get It” on Niche Brand Status
August 30, 2007

By Bill Visnic

Saying a planned new compact car coming in a few years is a “terrific opportunity for us,” Saab Automobile USA executives also claim owner General Motors is beginning to understand how to manage the niche brand -– just as the future of small-volume, premium brands such as Saab appears to be reaching a crucial juncture.

At a media event for the redesigned 2008 9-3, Knut Simonsson, executive director, Saab Global Sales and Marketing, tells AutoObserver that because of the increasing “globalization” of virtually everything –- common talk now is dominated by terms such as “global business” and even “global warming” –- consumers will increasingly gravitate toward brands that evoke strong images of heritage or national origin as a way to satisfy their desire for more “context” for their purchases.

That, says Simonsson, is an opportunity for Saab.

Coveting Niche Brands

Simonsson says this expected new desire for purchase context also is what has entities as varied as U.S. hedge funds and Indian automakers lining up for a chance to buy Ford’s Jaguar, Land Rover and Volvo brands. Each enjoys powerful perceptions of national flavor and heritage similar to Saab’s unique reputation for quirky but sensible Swedish design.

Saab expects this kind of strong identifier will become increasingly important in a consumer future that is moving towards dispassionate products and anonymous brands, Simonsson says.

“I am convinced of this,” he says.

GM "Getting" Saab Niche

Meanwhile, Saab plans to take full advantage of the predicted power of niche brands, saying GM –- which took full ownership of Saab in 2000 -– is starting to “get it” in terms of leveraging Saab’s brand qualities.

Last year, Saab sold about 133,500 vehicles worldwide.

“It’s not easy when you [GM] make 9 million cars a year to figure out how to be a steward,” says Steve Shannon, Saab Automobile USA’s general manager.

“We are getting to be a very good steward of the brand.”

GM Expands Saab's Product Line

Shannon says Saab’s got to get more models on the showroom floor. Currently, it has the 9-3, redesigned for ’08, the 9-5 midsize sedan and the 9-7X SUV, a craftily reskinned Chevrolet Trailblazer that never has been right for the brand.

The first priority, says Shannon: “To replace the 9-5 with a very strong successor.”

The flagship 9-5 was introduced in 1997 as a ’98 model, yet Simonsson says the 9-5 is the ideal example of the power of the Saab brand, noting the absurdly old car set a sales record last year.

Then the product range will be expanded with an all-new crossover vehicle. Saab executives say crossovers are the fastest-growing market segment, both in the U.S. (Saab’s largest market) and in Europe.

That model almost assuredly will be placed on a GM front-wheel-drive platform, likely a “premium” version of the General’s global midsize architecture. Although past speculation has lined up a Saab crossover with a variant of Cadillac’s SRX, that seems unlikely, as the SRX is based on GM’s rear-drive Sigma platform, and Simonsson asserts Saab “will never skip front-wheel drive” as a base drivetrain layout. Like rival Audi AG, Saab also plans to increase the use of all-wheel drive as an enhancement to front-wheel drive, however.

Saab’s history and reputation for front-drive, Simonsson says, demands its future vehicles use that configuration.

Shannon says the all-new 9-5 and the Saab crossover will come to the U.S. at about the same time, probably around 2009-'10.

Following those two crucial models will be a vehicle smaller than the 9-3, currently Saab’s entry-level model.

Shannon says Saab and GM will not repeat the exercise of the 9-2, a hastily reengineered Subaru Impreza WRX that bombed in the U.S. market and was dropped in 2006.

The new subcompact Saab, says Shannon, will key on three elements: “breakthrough” design, sporty driving characteristics and strong functionality and utility.

Saab executives will not provide a time frame for when the new entry-level Saab –- a competitor for BMW’s Mini Cooper, Audi’s A3, Volvo’s C30 and the coming BMW 1 Series –- will be launched, saying only that it will arrive after the next-generation 9-5 and all-new crossover model.

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