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Monday, July 09, 2007

GM's risky challenge

Carmaker bets on showroom face-off with Asian cars

Sharon Terlep / The Detroit News

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Sales consultant Geri Bussure helps Duane Ellis of Chelsea as he checks out a Toyota Camry at Saturn of Ann Arbor. Saturn showrooms nationwide have Camrys and Accords for its "Side-by-Side-by-Side" campaign.

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Sarah Woolson is general sales manager at Saturn of Ann Arbor, where buyers can test-drive Auras and a Camry, right. Nationwide, Aura sales totaled 27,200 through June, compared to 212,500 for Camry.

ANN ARBOR -- A look of disbelief crossed Karen Smith's face as a Saturn salesman handed her the keys to a shiny new Toyota Camry.

"Really, go ahead and drive it," he told Smith, who was car shopping for her teenage son. "Try the Honda, too."

Off she drove, rolling out of a Saturn dealer's lot in the hot-selling Toyota, her two sons and their grandmother in the car. For the next 15 minutes, the brood weighed the pros and cons of the Camry and the Saturn Aura, from the handling on a tight corner to the arrangement of the instrument panel.

The unlikely exercise is part of a new promotion from General Motors Corp.'s Saturn brand that pits the new Aura four-door against American car buyers' perennial favorites -- the Camry and Honda Accord -- in Saturn showrooms across the nation.

Not the type of risky tactic GM would likely have tried even a few years ago. The strategy could backfire if Saturn shoppers drive a Camry and Accord and like it better.

But after decades spent defending its dominance in the market, the auto giant is going on the attack against a bigger, healthier competitor -- Toyota Motor Corp. -- and trying to loosen Toyota's and Honda's grip on the sedan market.

"We want to make sure people understand we're unbelievably confident in our product," Saturn General Manager Jill Lajdziak said. "You've got to try different ways to cut through the clutter in a very crowded marketplace."

The Smiths make a perfect target for Saturn: a family of four living in the trendy Ann Arbor area, and Smith and her husband were once Ford Motor Co. loyalists. A run of malfunction-prone vehicles turned the couple toward the competition. In recent years, they have been happy owners of a Camry and a Honda Pilot SUV.

A desire to bolster Detroit's struggling auto industry has them tentatively considering buying American. Their 15-year-old, Kevin, will soon need a car, and they want something safe, practical and appealing. The family also is encouraged by signs that domestic automakers are closing the quality and reliability gaps with foreign companies.

"We're ready to try again," Smith said.

At first, the family compared the vehicles' exteriors. They all preferred the Aura's sloping front end to the flatter Camry.

Inside the Camry, Smith's sons complained they couldn't see the dash-mounted clock from the back seat. Having driven the Aura, they talked about the roominess and overall feel of both vehicles.

Kevin Smith, the soon-to-be driver, thought the Camry had "pep" and was impressed by its handling.

His grandmother, Beverly Good, was mostly pleased that the Saturn saved them the trouble of visiting a Toyota or Honda store.

When the drive was done, the foursome huddled. They mostly agreed on the Aura, though the Camry's cavernous trunk almost won Kevin over, since he needs space to haul hockey equipment to and from camp all summer. A final decision will come later, after Smith's husband gets a chance to weigh in.

"It's a good idea," Karen Smith said of the promotion. "If they're really confident in their product, they've got nothing to lose."

Strategy similar to Ford's

Buoyed by a slew of well-received products, GM desperately wants to convince consumers that it really can compete against foreign nameplates that have cannibalized sales of Detroit's Big Three. For the first time in 76 years, GM lost its claim as the world's largest automaker when Toyota outsold it worldwide in the first quarter.

"For years, people bought Japanese cars because they thought it was the smart choice," GM marketing chief Mark LaNeve said in a recent interview. "Our products are every bit as competitive."

As part of GM's assault, Saturn dealers nationwide bought or rented a Camry and Accord to have in showrooms for the "Side-by-Side-by-Side" national campaign that runs through July.

The automaker may try a similar promotion when the redesigned Malibu hits showrooms this fall.

GM's strategy is similar to Ford's, whose recent Fusion Challenge ads pitted the Fusion sedan against the Camry and Accord.

Battle to win back buyers

Winning back customers is going to be a battle for GM.

Among consumers who bought Honda Accords between November and January, only 1 percent had also seriously considered the Aura, according to data from J.D. Power and Associates' 2007 Initial Quality Study, which measures consumer satisfaction in the first 90 days of ownership. Among Camry buyers, none had considered the Aura.

Saturn's Lajdziak acknowledges the challenge of getting on some shoppers' lists.

Sales of the Aura, which won the North American Car of the Year award at the Detroit auto show in January, totaled 27,200 through June, compared to 212,500 Camrys and 180,000 Accords.

Mentioning the Aura along with the Accord and Camry will help consumers familiar with the Japanese models recognize the Aura as a midsize sedan, Lajdziak said.

Toyota, which saw sales jump 10 percent in June compared to GM's 21.3 percent drop, is taking the heat in stride. Having its vehicles shown in Saturn showrooms may even help draw customers who wouldn't normally buy an import, spokesman John McCandless said.

"We're being targeted as very good, high-quality products," he said. "I'm not so sure that's a bad thing."SOURCE detnews

The Aura is ugly IMO, I give them props for going after the imports they will have a lot of catching up to do especially with the Camry.

Wow that's pretty interesting:
That basically translates to the fact that people who DID buy the Camry and Accord almost exclusively DID NOT consider the Aura, but those who DID buy the Aura, also considered the Camry and Accord.

What does that mean? Basically the extremely large majority of people who DID seriously consider the Aura, ended up buying it. The extremely large majority of people who bought one of the other two cars never even seriously considered the Aura.

Further translation: If you seriously check out the Aura you'll probably end up buying it.

Interesting!

The Aura is still relatively new, and it has plenty of potential growth.

I would like to see it help GM get back into the game, but this is such a small drop in the bucket. They have more worries than tackling the midsized family sedan market...

Anyone know if Saturn is comparing their V6 with the Accord and Camry V6's, or if it's 4 cyl vs. 4cyl. Apples to apples kind of comparisons?

100,000 cars per year has a huge impact when you get down to the individual plant level. If a current line's annual capacity is 300,000 cars annually but your only selling ~50K... You have a lot of high paid union labor doing not a whole lot of work.

Anyone know if Saturn is comparing their V6 with the Accord and Camry V6's, or if it's 4 cyl vs. 4cyl. Apples to apples kind of comparisons?

I don't think there is a I-4 Aura, V-6 only. The car is IMO looks better in pics than in person but it does have some style and its nicer to look at than the Accord/Camry.

A couple months does not make a trend. The Camry/Accord names are imbedded in the heads of Americans as THE family transport to buy.

The Aura will need to continue to evolve and be a quality car. Its a great effort by GM.

If anything, Honda needs to watch for Altima sales....they might pass the Accord in the next couple years.

The Aura is ugly IMO, I give them props for going after the imports they will have a lot of catching up to do especially with the Camry.

A lot of people say the same thing about the Accord and Camry. The Saturn at least has the benefit of having the safest styling, which means that it will be less polarizing.

And as far as catching up, I've been in all 3 vehicles within the past 6 months, and I think the Saturn has a nicer looking and better quality interior compared to the other two. If anything, I think Toyota and Honda have some catching up to do.

GM has done a great job with the Aura, and obvious must be 100% confident that it offers a better overall package for the money than the Accord and Camry. I certainly don't doubt it one bit.

I think the Aura looks great in real life.

The sad thing is it takes a foreign made Opel platform to get this nice a car from GM.

I too think the Aura looks really nice. Between that and the Sky, Saturn is turning into a really nice company. Much progress since the mockable plastic bodied junks of the past (although the plastic panels were really cool. If only thye could mold the plastic to suit the new bodies of these saturns.)

Last time GM brought an Opel over, it did not succeed as the Cadillac Catera. Maybe this time, with the Saturn Aura they will do better.

The Opel version is better than Aura though... :sad:

The Opel version is better than Aura though... :sad:

It is similar to the Opel (though badged as Chevy in Mexico) Vectra.

A while back when I was assisting on fleet sales for our representatives in another company, we entertained an offer from GM and I brought the point up about Saturn not here in Mexico. They told me they though it would not match up well against other competitors of similar price and it was better to concentrate on the smaller, lower-priced vehicles. I asked them what made them think it couldn't compete, I said that the Accord and Camry sell well in that market, but they didn't answer on it.

Comparing the Aura with the new Camry, sure. Comparing it to a 5 year old Accord though? :uh:

I too think the Aura looks really nice. Between that and the Sky, Saturn is turning into a really nice company. Much progress since the mockable plastic bodied junks of the past (although the plastic panels were really cool. If only thye could mold the plastic to suit the new bodies of these saturns.)

Sorry, but that's spoken like someone who really knows nothing about Saturn of the early 90's. Even today their cars do not approach the level of build quality, fit-and-finish, value, or innovation of the initial Saturn line-up.

The Aura is a decent product for, say, Chevy to introduce. Saturn, sadly, has totally lost its way and no longer has an identity in the marketplace. This "side-by-side test drive" is even a desperate attempt to regain some of the marketing magic that Saturn had in its heyday. Like others here, I wonder how comparable the cars really are and what impact the promotion will actually have in the long term on sales.

I like the styling on the new Aura. However, I had a chance to sit in it twice. The first time was a decent experience. But the second time I sat in it (oddly enough, they were very similarly spec'd even though one was a Canadian Aura and the other was an American Aura) turned me away from it. The whole centre console could move left and right. The door panels and plastic looked and felt cheap. I don't even think the Sonata's centre console can move at all.


However, I did like the feel of the radio/climate control buttons and the dashboard is a very very nice soft plastic. Both make it feel upscale but the plasticky door and movable console detract from that feel.

inside the Camry, Smith's sons complained they couldn't see the dash-mounted clock from the back seat.

Like your watch, Ipod, and PSP didn't have one? :rolleyes:

Sorry, but that's spoken like someone who really knows nothing about Saturn of the early 90's. Even today their cars do not approach the level of build quality, fit-and-finish, value, or innovation of the initial Saturn line-up.

The Aura is a decent product for, say, Chevy to introduce. Saturn, sadly, has totally lost its way and no longer has an identity in the marketplace. This "side-by-side test drive" is even a desperate attempt to regain some of the marketing magic that Saturn had in its heyday. Like others here, I wonder how comparable the cars really are and what impact the promotion will actually have in the long term on sales.

Nope. I have several friends who own or owned the original Saturns and aside from the new approach in their dealerships and the plastic body panels, the cars were very ordinary and never really approached the fit and finish of their Japanese rivals. The engines in the originals were very anemic and the handling was not upto par. I know people got caught up in the idea of Saturn, as did some of my friends. Quite remarkable marketing, ordinary vehicles.

Nope. I have several friends who own or owned the original Saturns and aside from the new approach in their dealerships and the plastic body panels, the cars were very ordinary and never really approached the fit and finish of their Japanese rivals. The engines in the originals were very anemic and the handling was not upto par. I know people got caught up in the idea of Saturn, as did some of my friends. Quite remarkable marketing, ordinary vehicles.

Nope to your "nope". ;)

"The cars were very ordinary"--They featured a slew of revolutionary technologies, and several that were featured only on much more expensive cars. In addition to the polymer bodyside panels, they had such things as anti-lock brakes, a timing chain instead of a belt, a hydraulic clutch, and variable-effort power steering. Remember, these were cars that topped out at $15K and these features were far from common back in 1991.

"Never really approached the fit-and-finish of their Japanese rivals"--Every magazine comparo of the day disagrees with you. Saturn was heralded as a miraculous effort by the lumbering GM in that it not only matched but actually surpassed Honda and Toyota in both initial quality and long-term reliability.

"The engines were anemic"--Not compared to what else was on the road. Yes, the 85bhp base engine was tiny but that was in an economy car that stickered for less than $8K. The 124bhp engine was wonderfully peppy in such light vehicles and achieved a 0-60 time of 8.0 sec in the coupe (which beat everything else in its class, even cars costing $5K-$10K more).

"The handling was not up to par"--The 0.89g skidpad rating of the original SC would make it a fine roadholder even today, 16 years after introduction.

"Quite remarkable marketing, ordinary vehicles"--I'm afraid you're confusing the Saturn of today with Saturn as it was originally conceived and introduced. GM went to extreme measures to insulate Saturn from the rot that was affecting the rest of the company. All decisions were divorced from Michigan meddling, and the construction of a state-of-the-art plant staffed by non-union workers enabled them to do things that were never possible for the big corporate parent saddled with legacy problems. They brought luxury-car customer service to entry-level consumers and proved that dealerships could still make a profit on service even when offering free carwashes and complimentary snacks. Their no haggle/ho hassle pricing sent shudders through the rest of the industry. And the cars themselves, superior to their competition in every way (except unproven), undercut prices by a large margin. Granted, it took them less than five years to screw up the grand experiment and Saturn today is nothing more than another division of GM. But please look at the facts of Saturn's history rather than your remembrances of a few friends' cars.

You can quote all you want. I'm talking from first hand experience of 3 friends who owned first gen Saturns. You really believe everything you read? Unremarkable cars with remarkable marketing.

You can quote all you want. I'm talking from first hand experience of 3 friends who owned first gen Saturns. You really believe everything you read? Unremarkable cars with remarkable marketing.

You are certainly entitled to your opinion. I personally owned two 1991 SC's, a 1992 SC, and a 1995 SC2. My personal experience combined with the overwhelming opinions of the educated automotive press are far more compelling to me than your extremely limited second-hand anecdotes.

To come back to the point of the current thread, this new marketing campaign does remind me of the good, creative marketing Saturn had at inception (at least we agree they had good marketing at the start). If the product is worthy, all they need to do is to get people into the dealerships. I question whether their current line-up is truly worthy.

I too think the Aura looks really nice. Between that and the Sky, Saturn is turning into a really nice company. Much progress since the mockable plastic bodied junks of the past (although the plastic panels were really cool. If only thye could mold the plastic to suit the new bodies of these saturns.)

I considered a Sky but judging by the posts by owners of Saturn's Halo car, its drive train is junk. The differential leaks, clunks, and flat out breaks under 10,000 miles, the AC compressor is noisy in many cars, even stories of cars flooding and not starting if driven a few feet and not driven a good distance. Many people have had to get warranty work done under 5,000 miles. Our Accords, Camrys, Previas, MR2s, and RX300 have not been in for ANY warranty work related to the drive train, or poorly fitting panels, tops, or cup holders. The drive train is the most important thing in a car, you can make it look good, but under the skin its still a POS. I've passed on the 2007 Sky, and it looks like the 2008s will get passed again by me because GM is still not addressing drive train issues, instead telling people "oh that clunk/whine is normal". WOW.

Sorry but I drove my cousin's 1993 SC, it was a POS. It rattled, it felt cheap, and it drove really vauge. My 1991 Honda Accord was better made inside and out, lasted to 150k miles until I totalled it. She got so sick of taking it in for repairs she bought one of the original Toyota RAV4's still driving it today and she said she will never go back to Saturn.

The one thing Saturn had for it was the Lexus like Customer Service and no haggle car buying experience, but my experience with trying to buy a Sky locally they are doing the usual crap buying experience, dealer markups, adding a bunch of crap to the car, take it or leave it attitude, some buying experience Saturn, they have turned into the rest of the GM family, too bad.