Saab Plots Comeback - Minus the Machine Guns
By Bill Visnic June 16, 2010BMW and machine guns probably don't spring to mind when considering how Saab Automobile AB will bounce back from the brink of liquidation. But the two go together if you're Victor Muller, the charismatic founder of Dutch sports car maker Spyker Cars NV and now chairman of newly created Saab-Spyker Automobiles.
Muller says he's an admirer of BMW's marketing strategy, and believes the same kind of focus is a key to helping Saab zero in on a specific clientele. At the same time, the Swedish automaker must avoid being all things to all people, or what Muller refers to as using a "machine gun" sales approach.
"Saab doesn't need new customers," Muller flatly said, while speaking at Saab's Trollhattan headquarters during the media launch of the 9-5 Aero XWD luxury sedan.
He believes owners of existing Saabs - all 1.8 million of them, according to Muller's math - will "flock back to the brand" now that the company is no longer under the yoke of GM ownership. Looking relaxed and refreshed, sporting his customary three-button pinstriped suit (and incredibly expensive-looking watch), Muller's enthusiasm remains electric - even as his numbers sound dubious.
Saab certainly has its work cut out for it.
Stretching for Sales
Sales in the U.S. for 2009 amounted to a measly 8,680 units. Earlier this year, while GM waffled between selling and liquidating the brand, Saab essentially ceased to exist for a span of seven weeks. Having been saved at the last moment by a bid from Muller's Spyker, the Saab factory is once again revving up for production as new product, like the 9-5 Aero, comes to market. The 2010 9-5 sedan arrives not a moment too soon, as the platform beneath the outgoing model dated back to the Reagan administration. 
Comfortable to drive and handsome to look at, the 9-5 Aero is a fine car. Yet a starting price of nearly $50,000 places it among better-known, and in some cases significantly cheaper rivals such as the all-wheel-drive Acura TL, Cadillac CTS and Audi A6.
But Muller maintains his optimism, opining that Spyker's Saab purchase "is an opportunity that is once in a lifetime," and crediting the opportunity to what he calls "the perfect storm" that gripped the automotive industry during the global recession.
"For the price of a wind tunnel" Spyker -- a company whose annual output is approximately a couple dozen cars -- purchased Saab, a brand "200 times its size -- that's laughable," says Muller.
And with a single well-established production base in Trollhattan, Sweden, he insists the road to profitability will be a short one. Saab cannot target a "generic buyer," says Muller. "Do you use a machine gun to get everybody?" when trying to sell a car, he asks. Probably not, though Saab has been forced to lob plenty of sales incentives at customers in the recent past.
Saab will cater to a unique customer and profits will be "way into the black," according to Muller, when annual sales are projected to reach 125,000 units in 2012. Company officials insist Saab's break-even sales point is between 80,000 and 85,000 units annually. 
Saab Cars North America President and COO Mike Colleran told AutoObserver in March the company's break-even for the U.S. is around the U.S. unit's traditional point of about 30 percent of global sales - meaning Saab needs something like 25,000 sales in the U.S. to stay above water. That's about three times what Saab sold here last year.
New Iron Desperately Needed
With the new 9-5 now on sale and additional new models like a revamped 9-3 (projected launch: 2012), the GM-engineered and contract-built 9-4 crossover (late first quarter next year) and luxury subcompact 9-1 on the way, Muller says Saab will soon "feed itself" in terms of profit and "a fully funded five year business plan" is now in place. 
About the only point Muller remains quiet about is who Saab might team up with in terms of combining resources, sharing parts and limiting expenses.
"Will we see further clustering in the (automotive) industry? Definitely." He singles out the subcompact Saab 9-1 luxury car as being essential to the brand's values and long-term future. "We are very aware of the heritage of the [Saab] brand," says Muller, insisting that Saab's traditional design cues will play a role in the 9-1, but that the design "will never be retro."
Like the new 9-5, which uses a both a GM platform and engine, the 9-1 might be a new-era Saab, yet the car's DNA could be anything but entirely Swedish. Industry reports hint that Saab will team up with another manufacturer to share a platform and engines for the 9-1 -- and one potential candidate is the same German automaker Muller says he admires most, BMW.
No word yet as to whether machine guns will be part of the deal. -- Nick Kurczewski, contributor
Photos by Saab
1. Victor Muller, founder of Spyker Cars NV and chairman of Saab Automobile AB.
2. Original Saab 92 serves as design inspiration for planned new-age variant, the 9-1, that could be sourced from BMW.
3. Saab 9-4X comes early next year, built under contract from former owner GM.
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BMW's marketing strategy must be different in Europe than here in the US. Here they are definitely trying to be all things to all people. They show 56 different models on their website.
Nissan/Renault's Carlos Ghosn is looking for a platform buddy-maybe put a 92-style body on Versa running gear for the 9-1.
Saab in the Old Country isn't perceived as in the same niche as the Volvo S80, A6 Audi or even the Ford Mondeo Titanium. Think $50,000 Chevrolet Malibu and that's where they view it; too spendy for a car that is Opel underneath.
I think a better strategy would have been to put all that 9-5 tooling on craigslist and use the money to develop a nice B-segment car-where Saab belongs.
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