HBR Blames GM For Saturn’s Demise; Then Blames Saturn For GM’s Downfall

But an even bigger cost for GM was the time it lost building a brand it believed could fight off its Japanese rivals. The enormous strategic shifts that GM has been forced to make over the past year should really have been made back in the 1990s. If only Roger Smith had not believed that Saturn was the “key to GM’s long-term competitiveness, survival, and success as a domestic producer,” the company would have moved faster and earlier to fix its core business. The notion that another brand, rather than fewer brands, was the way forward turned out to be a colossal distraction.

Weep not for the loss of Saturn. The brand should be remembered as a failure from the start for three reasons. First, it failed to deliver on its mission to fend off the Japanese imports that now dominate the US market. Second, it managed to lose billions of dollars at a time when GM needed every penny it could muster. Third, Saturn represents perhaps the single biggest explanation for GM’s current precarious situation. Saturn’s demise did not take place on Wednesday of this week. It started on a cold morning in Michigan a quarter century ago with the launch of a business model fatally flawed.

But an even bigger cost for GM was the time it lost building a brand it believed could fight off its Japanese rivals. The enormous strategic shifts that GM has been forced to make over the past year should really have been made back in the 1990s. If only Roger Smith had not believed that Saturn was the “key to GM’s long-term competitiveness, survival, and success as a domestic producer,” the company would have moved faster and earlier to fix its core business. The notion that another brand, rather than fewer brands, was the way forward turned out to be a colossal distraction.

Weep not for the loss of Saturn. The brand should be remembered as a failure from the start for three reasons. First, it failed to deliver on its mission to fend off the Japanese imports that now dominate the US market. Second, it managed to lose billions of dollars at a time when GM needed every penny it could muster. Third, Saturn represents perhaps the single biggest explanation for GM’s current precarious situation. Saturn’s demise did not take place on Wednesday of this week. It started on a cold morning in Michigan a quarter century ago with the launch of a business model fatally flawed.