The Bold Experiment that GM Forgot: Saturn's End Seems Near
Things could be worse for Saturn. Perhaps some international planetary society could strike it from the list of planets orbiting the sun, as happened to poor Pluto. Saturn is, after all, just a ball of gas with a ring of rocks and ice orbiting its equator. But its status as a planet is much more secure than its status as a car brand. The fate of Saturn the automobile appeared sealed yesterday when would-be saviour Roger Penske abruptly cut off talks to acquire the once-promising General Motors unit. GM then said it would wind down Saturn's operations within a year.
Then GM chairman Roger Smith created a buzz in 1983 when he announced his plan to create an entirely new kind of car company. But agility was not among GM's bag of tricks even then. It was 1990 before the first Saturn sedans rolled into their haggle-free showrooms, and buyers were invited to a gleaming new manufacturing plant in Tennessee to see their Saturn make its way down the assembly line.
Even from the start, recalls Wharton management professor John Paul MacDuffie, GM seemed unwilling or unable to sustain its commitment to Saturn's success. "People in GM and outside were pretty excited about the possibilities" represented by Saturn. "But it was announced in '83 and the first car wasn't selling until 1990. I think they lost a lot of ground right there." More ground was lost as Saturn took six years to come up with a larger sedan for its initial buyers to trade up to. Its small SUV hit the market in 2002, six or seven years after the [Honda] CRV and [Toyota] Rav4" had established that market.
In addition, the new Saturn models released in recent years were not the clean-sheet-of-paper designs of Saturn's early days, notes MacDuffie. Rather, they were based on platforms developed by GM's European subsidiary, Opel.
Many industry observers, including MacDuffie, co-director of the International Motor Vehicle Program (IMVP), have said that Saturn was done in by competition within GM, where other divisions — especially struggling ones such as Pontiac and Oldsmobile — were jealous of the resources lavished on the Saturn in its early days. Compromises to keep everyone in the company happy led to the slow starvation of Saturn. "It all makes you want to say, 'What were they thinking?' It was really a political process," according to MacDuffie.
But he also believes Saturn may have been overly devoted to its clean-sheet-of-paper approach when, for example, it passed up an opportunity to learn valuable manufacturing process lessons from GM's joint venture with Toyota, New United Motor Manufacturing Inc. (NUMMI).
Still, Saturn's brief and bungled history offers lessons for the new GM, if it can recognize them, says MacDuffie. "There seem to have been a lot of missed learning opportunities here for GM. It has to find ways to capture learning opportunities from even those experiments that fail."
