As I mentioned earlier this week, I was fortunate enough to speak with Saab Cars North America President and Chief Operating Officer, Mike Colleran, on Wednesday morning. He is kind to make himself available for us at SaabsUnited, and I hope that this is a conversation that flows pretty freely as the newly independent Saab “follows its own road” to success here in North America.
I’ve not attempted to edit Mr. Colleran’s words much; they don’t particularly need editing anyway. My hope was to convey his message to you dear readers as they were given to me. That won’t always be the case, but for now I think that transparency is of value because we’ve heard so little from the American Saab organization while the battles were raging in Europe and in the GM boardroom.
Finally, I’ll categorize some of Mr. Colleran’s answers as very general. At this point in Saab’s re-organization, that is expected. There is simply too much work to be done before the details come into focus. I understand that, and I hope that you give him that understanding as well.
What are you working on right now?
Colleran: Dealers have been assigned to the company. Now we’ve got to get them product. The second step is to finalize our relationship with GMAC and re-introduce leasing. If you look back historically at the sales loss back to August of 2008, probably 60% of the sales loss is directly attributable to just not having a lease available. This segment, European luxury, penetrates very deeply on leasing as a retail tool. Saab dealers have not had that available, nor have Saab customers, in a year and a half now. High, high priority on getting a lease in place.
A second priority is establishing Saab as a European brand, a Swedish brand, in the market, or should I say re-establishing Saab as a European brand. We’ve transitioned to the global the tag line, “Move Your Mind” which is now out on the website and in the mail campaigns which definitely ties us back to our parent company and our roots.
What’s changed now that you are independent?
Colleran: One, Saab now has the freedom to express itself as an import brand and as a Scandinavian brand. Looking back into our past there were a lot of ties into the General Motors advertising efforts. Along the way, Saab, probably more accidently than purposely, became more identified as a domestic brand. We don’t have to do that anymore. We are free to express ourselves as we would like to.
Another thing being independent allows us to do: we are free to offer retail tools that are built more for Saab and the European luxury segment than for the volume portions of the market. You probably won’t see us involved with the traditional General Motors events that Saab was participating in. You saw those many times. There would be six or seven divisions across the bottom, it would be a “Red Tag Sale” or a “Hot Button” or something like that. It worked well for General Motors, quite frankly, but it made Saab appear more domestic and, too, it didn’t really address the Saab customer’s specific needs. So, we can be more targeted in messaging and retail offers.
What are you doing to support our fellow Saab enthusiasts in Canada?
Colleran: Absolutely it is our intent to re-enter Canada. Canada is an extremely important North American market. It is definitely a part of Saab Cars North America charter to get back into Canada. As you know, the warranties are all being covered by GM of Canada, so the customers that purchased Saabs still have their warranties being honored at various General Motors stores across Canada. It is our intent to try and get into Canada in the near future. I don’t have a date for you yet, but I would describe it as sooner rather than later. We may have an announcement in the near future, but I’m not ready to announce anything yet.
Are you planning to support Canadian operations with an independent dealer network or will you partner with an existing automotive distributor?
Colleran: We will use an independent import model, and I don’t have a comment yet on the dealer network. I think it’s premature to do that. Until we announce the timing and who that [import] partner might be, I think it’s premature to talk dealers, but we’ll be ready to do that after an announcement of intent.
What else do you feel will change in how you sell and service Saabs in the US?
Colleran: We’ll be able to focus more on our customers. Don’t have a lot of definition around how we’re going to do that, but I think that we’ll be able to address our customers in a more direct and open fashion. Essentially, what I’m saying is that in the beginning we are going to focus on those customers that have been with us. We’re going to be somewhat loyalty-focused. Maybe with additional loyalty offers. In fact, yesterday we did just that — we offered an additional loyalty bonus to those customers that have been with us.
It’s been published that the stocks of Saabs are right around 500 in the US. When do you think that more cars will be available?
Colleran: First of all, the 500 number is a little low. We do have a shortage of inventory, no question about it. We build ten models and some of those vehicles are being shipped as we speak. Others will be loaded over the next week to ten days and we will start seeing tens of cars arrive in the mid-March timeframe. Regular ordering has started, and we know that we have pent-up demand for several thousand. Orders will be pumped over to Sweden over the next month or so and more beyond that as the pipeline starts to fill.
In the past, Saab has had one of the best European delivery programs available. Do you have any plans to reinstate it? Perhaps 2011?
Colleran: I’d like to re-start the program; customers loved it. It was a very difficult program to manage for us, so it’s not my first priority to bring it back as we try to work those priorities that I gave you earlier, but it is on our radar screen to examine and potentially bring back if it makes sense.
There has been a lot of ink spilled on the 9-5, but for the North American market, I want to focus a little on the 9-4x which I think is a great product to build volume here. When do you expect the first units to be available and are you going to continue the same advertising partners associated with it (e.g. Salomon) without GM’s involvement?
Colleran: The 9-4x is a HUGE win for us. The 9-5, don’t get me wrong, is a very important car for us in a segment that we’ve really not been in for a while, but the 9-4x is a huge volume opportunity for the US Saab dealers. I think that they’re all very excited about it. We’ll start to see cars in early calendar 2011; that’s the plan.
As far as advertising partners, it’s still premature. We still have to develop a strategy. The US will be in the lead for development for 9-4x strategy because the US market will be the largest piece of the volume. We’re going to start that strategy in the not too distant months, so it’s just too early to say who our partners will be.
When will the first 9-5’s be available?
Colleran: Early summer. As you know, we’re showing it at all of the shows right now, and production should be starting soon [for export].
Victor Muller has spoken a lot about a “small car”. Americans have not historically embraced small cars. Is now the time? Will this vehicle sell here when introduced three or four years hence?
Colleran: Yes, I think that clearly the American consumer is starting to change. Their needs are starting to change (to some degree), and the fuel conversation is driving the American consumer to make different choices. I think smaller cars are one of those choices. I think we’ve already seen some success stories out there on small cars. Not all of them have been success stories, but some have been. I think of Mini. They brought to market a model that works, and I think it can be done. I think as American tastes change and needs change there will be more and more volume.
What are your plans for tuning options in North America? Could we see Hirsch on this continent? (The Steven Wade Memorial question.)
Colleran: We really haven’t discussed that. Anything’s a possibility. I love the thought of getting into partnerships and different accessories for Saabs. At this point we are really focusing on the three or four key things that we’ve talked about already. Let’s get the basic building blocks in place. Let’s hang the ornaments on the tree once we’ve got it up.
There has been a display of grass-roots support for Saab. Can you use that in your marketing and sales efforts here in North America?
Colleran: Clearly we can. It’s more of a loyalty play here in the us than in Europe. There the plant is closer; it’s on their own soil: the plant, the engineering and the facilities. So while the “Save Saab” movement has been very strong here in the US and we’ve seen the “Save Saab” movement in every city, it’s more directly related to people that know us as customers. It’s a little bit different here than there, but can we tap into it? Absolutely. I think that our first steps have been around the loyalty offer, updating the website and making sure that the consumer letter is in people’s hands. Frankly the website and our digital efforts will really focus on that core group of people that helped save Saab here in the US.
How are you going to speak to those customers?
Colleran: I think there’s a bit of a growing process here in the US. As the volume starts to come up, it allows us to do certain things. As I said earlier, we’re going to focus on the loyal customer early on. You can get to that customer and talk to them very effectively through direct mail and digital work, but certainly we’re already expanding that, re-buying the search terms that we had, making sure that we’ve got in-market digital placement as well, so that’s the early step. Next steps after that we turn to newsprint and then ultimately I think that there’s some opportunity in the US, especially in the US, to widen the audience through newsprint and targeted television. Television is probably more down the road as we grow the business.
Is there anything you would like to add?
Colleran: Saab Cars North America team that we’ve had to rebuild from scratch has a ton of experience. We’ve brought back a lot of people with deep Saab roots in sales and service and some new people from outside like Michelle that are new to Saab but have deep automotive experience bring some cross-pollination to the team and we’re just really excited to get started again because we love this brand.