New York Update: “The f*#@ing break-even!”

Our Saabs United representative at the New York Auto Show was Jeff P and he’s been doing a fantastic job sharing his NYIAS experience, as well as the all-important chats he had with various Saab executives.
Here’s the latest of several reports he’s filed today. You can read them in their original context over at the SaabsUnitedNY website.

I won’t say whose mouth spoke the phrase in the title – at least three times within the span of 15 seconds – but I think you can guess. Lowering the break-even point is Saab’s greatest challenge in the next few years.
There are several ways to get there, each with their own pluses and minuses. Charge more for cars and make them more exclusive or pump up the volume and make them more accessible? I think the general attitude here is in favor of the latter, and for good reason. I think Victor and the team are smart enough to realize you can do both at once, and if you back up and pay attention to the ideas he has put forth, that’s exactly what seems to be happening.
On one hand, you have the new 9-5 which will carry the upper end of Saab’s range with the 9-4x for some time to come. Fully optioned out they will likely carry the same price tag as a comparably equipped Audi. While I haven’t driven either, I can vouch that the 9-5 is nearly as good on the inside (better looking, not quite as super tight feeling) and much better outside than the A6 or BMW 535i. That’s not as a Saab fan, that’s an objective fact- nearly every casual observer I witnessed said the same thing, even groups of 20 year olds calling to each other to check it out.
The 9-4x has the opportunity to make a huge splash in the market too, not only because it’s incredibly good looking but will most likely drive as well or better than the competition. Charge the right price for both and they will fly off the floor. While the 9-5 will be in dealers in a matter of weeks, the 9-4x is still some months away.
My suggestion to Saab, especially to Mike Colleran: get one example of the most loaded up version of the SUV to every dealer in the country, build an innovative display around it, and have customers able to see it so they might delay their purchase of a similar Q5, RX, SRX, XC60, X5, or ML. Crowded segment isn’t it? That’s why Saab needs to be bold here and show customers it is serious.

So many people opened up their dialogue to Saab greeters by saying, “You’re still alive?” I have no doubt many customers will say the same thing when they walk into their dealer. What better way than to show them the production model at the dealer? I understand these projects take months to implement, but if Saab really is a more nimble operation now, they should be able to get this done reasonably quick. If I can design, research, create, produce content and maintain this site in less than 5 days – Saab can develop an innovative display and get some preproduction units to its North American dealers in a few weeks.
On the lower end you will have the new 9-2 (or 92 or heck even something completely different). This car will eat a huge chunk out of Mini’s sales, I can guarantee. So who drives Mini’s? Sure you have your affluent younger single crowd, but what BMW found shocking was you had a lot of older empty nesters that wanted affordable, quality, small high gas mileage cars.
Saab has a unique opportunity to cater to both groups even moreso with this car because on one hand it will be completely different from anything else on the road and so instantly being new and thus modern in a way, but it will also have a nostalgic shape that older drivers should love. It will have one of the lowest drag coefficients out there, and with some good old fashioned Swedish ingenuity (and if I paid attention correctly to the smoke signals Magnus and others were giving me) some electric propulsion technology, it will definitely be blowing similar Hondas out of the water.
If the dealers can deliver excellent service and hassle free maintenance with a unique and special buying process, we’ll be seeing many Saab customers for life.
Goldilock’s car will continue to be the bread and butter 93. If you hadn’t already figured it out, there will be a hatch. This has been confirmed by several people already, and I heard it over and over again this week. More importantly, it will be a “Saaby Saab.”
People wanted me to ask what makes a Saab a Saab and anytime I do I get the same answers, most relating to general concepts of driveability, intelligent placement of functional elements, turbocharging, aircraft heritage, usable storage, and Scandivian design.
If you’re wondering why Victor thought of doing a 92 as his first independent project and were upset that he hadn’t chosen the 99 or 900 instead, consider for a minute you missed something extremely obvious: Saab was already planning their throwback in the form of the new 93. Granted, we’re not going to see a one off version of the 99 with Xenon and LED light detailing, but we will see familiar forms, according to Magnus Hansson. As I noted in a previous quick article, the 93 has a good chance of being called the 900 instead.
For those worried about retro details, I can’t stress enough you have absolutely nothing to fear. Saab can’t afford not to be modern at this stage of the game, so never expect a complete throwback model.
If you want to understand how Victor’s mind operates you need look no further than his own work at Spyker Cars. He didn’t go about recreating 100 year old looking throwbacks of Spykers of old, he channeled the spirit of the originals and drew up something absolutely unique among the supercar world.
I didn’t think much of the brand before the LA Auto Show this year, but then again neither had most of the world. The more I learn, the more I see, the more I witness from Victor, the more I love the brand. I will own one some day, no question he has found a future customer in me.
Last, and this may be a controversial statement, but even if they don’t charge as low as you want them to, it may be better for the company to keep prices in line with the competition, not much lower just to get them associated with the others in terms of market placement. Very few premium segment buyers have cross-shopped Saabs in the past, and many fewer will if they are compared to Acuras and Subarus instead of Audis and BMWs like they rightfully deserve.
Yes, Saab customers may visit the German dealers, but at the moment it’s rare for the reverse to occur. Most of you who are smart consumers don’t even buy new anyway, and yet you are the first to rant about Saab lowering their prices (not all, but you know who you are…). In no way am I suggesting that prices should be artificially high, just that they shouldn’t take a hit to their break-even for the interest of a slight increase in volume.
The good news is, it’s going to work. I think Victor may be as excited and optimistic as he is because for the first time in a while all signs are going his way. He started a supercar company and managed to race successfully in Le Mans, only to see profits dwindle at the prospect of the greatest economic collapse in 100 years. He negotiated to win back a Formula 1 team only to see his hopes stolen out from under him by a more recognizable name, Mercedes.
Finally he’s in the catbird seat with what he says is a car company for the price of a windtunnel. He’s right of course, and though he may have thought I was simply blowing smoke up his ass, I think he’s the perfect man for the job and that in a year or two’s time, he’ll be regarded as one of the most highly regarded CEO’s in the auto industry if not the world.

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