Saab Executives Talk of New Designs, Brighter Future

Topics:  Saab

John Birchard
May 27, 2003

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In an era of intense global competition in the auto industry, it seems life boils down to Darwin's Theory of Evolution at its most basic: only the strong survive.

From its earliest days as an offshoot of the company that made fighter planes for the Swedish military, Saab has always been a little different.

Starting production in 1947, the first Saab was an aerodynamic little coupe inspired by aircraft design and powered by a two-stroke engine with front-wheel drive solutions the rest of the auto industry would come to years later.

Saab has been a pioneer in safety and in turbocharging to achieve power with small-displacement engines. But General Motors owns Saab now and, in this global economy, the niche carmaker must grow or die. Published reports say the division lost $500 million last year.

"Saab was an independent company," said David Cole, chairman of the Center for Automotive Research in Ann Arbor, Michigan, explaining how Saab came to such dire straits. "They had relatively low volume. They were not terribly efficient in their manufacturing operations, and in that period [while independent] they could kind of get away with that. But times are different. It's a much more competitive world."

But David Cole does not see Saab suffering the same fate as the recently terminated Oldsmobile division.

"Any kind of a company that is losing money is going to be looked at very carefully inside of a group like General Motors, but I think really that they view Saab as a 'work in progress'," he said.

"We're coming into the most prolific new product period in our history," agreed Debra Kelly-Ennis, president of Saab Cars USA, pointing to GM's heavy investment in new vehicles for the brand. "And so, obviously, in a time like that you're going to be putting a lot of investment into new product."

Ms. Kelly-Ennis cites the new 9-3 sport sedan, followed by the convertible 9-3. Then, next year, a joint venture with another GM partner, Fuji Heavy Industries known more widely as Subaru. This new, lower-priced Saab will be called the 9-2.

"It's going to be a dynamite vehicle," she said. "We'll get it to market quickly. We've got a great partner there with Fuji Heavy Industries. The vehicle has been designed by our designers at Saab, so I think it's going to be a winner, again in terms of design, driving characteristics and so forth. So, it's really going to be a good one for us."

With a batch of new cars to sell, the Saab executive is excited about the future.

"Over the next few years, Saab is shooting for like around the 130,000-unit mark [annually worldwide]," she said. "And then here in the U.S. this year, our goal is to do something that has not been done in 16 years, which is to break through the 40,000-unit barrier."

"I think there's a very good prospect that Saab will be profitable not too far down the road," added David Cole of the Center for Automotive Research, who sees a brighter future for Saab as well.

To help insure that future, Debra Kelly-Ennis told VOA Saab is thinking of adding one more product to their line: you guessed it - a sport utility vehicle.