The single most commented post last month was the one concerned with US sales data, filled to the brim with opinions from people on what Saab Cars North America need to do to turn them around.
Many of them were well considered and appropriate. Many others weren’t. Such is life when you open up comments to the public.
Sales data for December should come out in the next day or so and I wanted to mention a few things prior to that happening.
Expectations for December
I don’t expect December sales numbers to be particularly strong in the US in December. Everything I hear tells me that dealers are still struggling to gain traction with the buying public.
There were quite a few 2010 Saab 9-5s sold at firesale prices. I heard of two selling at a dealership in Colorado on the same weekend, both around $16K off MSRP.
The end of year sales event being hosted by New Salem Saab produced some mized results. Despite having a list of around 70 vehicles on offer, Darryl only expected to sell three or four for the week (most were stock held by nearby dealers) and it looks like he’ll meet that objective. Other dealers participating in the event moved some stock, too. One of the other dealers sold at least 5 of the cars on their list.
One of the positives for the event was the increased awareness that it produced for those markets. Darryl fielded calls from far and wide, even from Canada, and he reported that the local interest level was higher than it’s been in the past. A smaller percentage of people are asking if Saab is still alive and are asking more about the actual cars.
Those are positive side effects, but the challenge of actually selling vehicles remains.
Before you jump into comments and say that you haven’t seen any Saab marketing in your area, please consider the fact that your area might not be a priority area for Saab right now (despite how much of a nice neighborhood it is and how much you like living there).
Quite a few people have dropped notes in comments relating to the fact that they’ve seen an increase in local marketing, including ads during football games, etc.
Saab have limited resources and despite a shaky start to the marketing campaign (She really wasn’t for ….. many people), I believe they’re doing the best they can with a limited budget.
I don’t know when the change to the US website is going to happen, but I don’t believe it’s far away.
We’ve just seen evidence that Saab are on the move with regard to their IT resources. Remember, these were very much integrated with GM’s back-end IT systems and untangling them, whilst undesireably slow, has been a Herculean task.
It’s a key area, though, and everyone that I’ve talked to at Saab acknowledges this. The impression I’ve got from them is that it’s writ large at the top of their to-do lists.
Volkswagen are said by many to be aiming to be the largest car company in the world and as such, they’ve got the volume to price their cars competitively in the US market. You can now get a Jetta for under $16K in the US.
The unfortunate side-effect is that many people think you should be able to get a Saab for that price, too. Reasons why I don’t think we’ll see a Saab anywhere near that price:
1) Saab don’t have the volume to price the 9-3 anywhere near that pricepoint.
2) The 2011 Jetta on sale in the US market has been panned from pillar to post for being one of the most bland, content-devoid vehicles ever. Dan Neil wrote one of the most scathing reviews for the WSJ. And Pete DeLorenzo had another crack at the Jetta in today’s 2011 kickstarter:
I was driving down the street the other day and I witnessed the manifestation of everything wrong with the Future of VW running right along next to me: it was a black, bone-stock, price-leader version of the new VW Jetta. As bland as any product ever regurgitated by Toyota – maybe even more so, in fact – and as forgettable and more frightening than I even imagined it could be, this thing was a rolling monument to tedium, a singular automotive atrocity of the highest order.
The Saab 9-3 is a vehicle that can still make a compelling case for itself. The Convertible is still an icon. The SportCombi is still very sharp and for those who like the standard 3-box shape, the Sport Sedan is well priced and a great driver. Whilst the range lacks a few of the most modern of mod-cons, it’s still well equipped and a great car that offers excellent driving dynamics no matter the season.
To hammer down the price of the Saab 9-3, they’d have to hammer down the equipment and character of the vehicle just as Volkswagen’s done with the Jetta. It’s not only undesireable, it’s just plain unwarranted.
US sales are slow, but I’m getting a growing feeling that that’s more of a symptom of problems with the US economy and habits of the US consumer than it is problems with Saab’s vehicle offering there.
It’s true that Saab NA and the powers that be in Sweden can do more – warranties, competitive leasing, standard equipment and especially service levels from some dealerships. I’m still hearing from dissatisfied prospective customers who haven’t heard back from dealers or the company for things as simple as the delivery of a brochure.
The US market is still a very tough environment, however. Economic conditions are still very difficult for many, which compounds Saab’s problems in terms of lack of awareness and the loss of customers in the lease cycle.
I think the economic conditions could be accentuating the conservative nature of the US consumer. Whilst some European customers have been happy to consider Saab’s newer model offerings, it’s been a slower uptake in the US – where you have to be very noisy to get noticed and somewhat more secure to lure those on the borderline. A number of US consumers have been almost like pioneers for the new Saab in a crucial market, however, and I’m grateful that they’ve jumped on board.
I think Saab are going to have to build momentum slowly in the US. Either that or do something extraordinary to generate some serious buzz.
Saab’s product offering is suffiently varied that it should attract sales in the vicinity of 2,500 or more per month in the US in normal conditions. We might only see 20-25% of that in December and if so, it’ll be a vast improvement over November sales. Such is the challenge facing Saab in North America right now.
I know that they’re working on it and the nature of that work has been covered many times here before.
I also know that many of you are going to have something to say when sales data comes out. I just hope you consider the big picture, what’s being done and the resources it’s being done with.