The Harvard Business Review has some particularly harsh words for General Motors today, as it opines on the obituary of Saturn. In a post titled “Why Saturn Was Doomed To Fail,” author Mark Ritson places the blame squarely on GM, going as far as to point to Saturn as one reason why taxpayers now own the manufacturer.
To wit:
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.
The Harvard Business Review has some particularly harsh words for General Motors today, as it opines on the obituary of Saturn. In a post titled “Why Saturn Was Doomed To Fail,” author Mark Ritson places the blame squarely on GM, going as far as to point to Saturn as one reason why taxpayers now own the manufacturer.
To wit:
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.
Non prime auto companies have gotten into trouble by extending terms and advances. It is also very difficult to rely on a scoring model in this segment. Just like mortgages we forgot how to underwrite in 2007 and early 2008
I can’t find anything to disagree with here. We watched as GM starved its other divisions, especially once proud Oldsmobile, while the company subsidized Saturn to the tune of billions of dollars. Still, I hope the dealer network can be saved for another manufacturer.
Primarily they did not have the pulse of the consumer and tried to have models / brands to cover each segment thus spreading themselves very thin. They were betting too much on a few horses based on ‘gut feeling’ rather than relying on the market data. Unfortunately the dealers ended up paying a big price for their loyalty.