GM claims sales dominance with Chevrolet Equinox

General Motors, which badly needs some more hits, has one where it counts -- in the hot small crossover segment, declares GM Vice Chairman Bob Lutz.

Small crossovers are the new sweet spot in the auto industry. So having a shortage of the Chevrolet Equinox is a great sign that GM is on the way back, Lutz says.

With Equinox,"we have broken through the barrier," he says. With sister vehicle GMC Terrain, "we dominate the segment" when it comes to purchase intent, he told the J.D. Power and Associates conference in Orlando yesterday.

GM sold 9,513 Equinoxes in January, Autodata figures show, and conceivably would have sold more if the model wasn't in short supply. By contrast, Toyota sold 7,894 RAV4s and Honda sold 9,672 CR-Vs. Check out our great selection of Chevrolet, Buick, Caddilac, and GMC today at www.BradhsawGreer.com

Penske's Saturn: The Post-Modern Auto Company

Auto companies have traditionally been engineering and manufacturing businesses, rather than marketing and retail businesses. Henry Ford, for example, insisted dealers pay for his Model Ts as soon as they left the factory door. But what made sense in Henry's time, and reached its apotheosis with the huge River Rouge plant, the most vertically integrated automobile factory in the world, has become a liability today.

Auto plants cost staggering amounts of money to build and to run. And in an era where the manufacturing process no longer delivers major differentiators in terms of the finished product -- all vehicles have to meet similar safety and fuel economy mandates, and the cost and quality differences between the best and the worst are getting smaller all the time -- that's money many auto industry insiders wished they no longer had to spend. Especially as what largely defines an auto company these days is not where its products are made, but how its brands are perceived by consumers.

A Boxster is still a Porsche, even though it is built in Finland by Valmet. A Grand Cherokee is still a Jeep, even though it is built in Austria by Magna Steyr. Right hand drive Mercedes C-Class and BMW 3 Series models are still seen as German cars, even though they are made in South Africa.

Which is why Roger Penske's Saturn play is a stroke of genius. With Saturn, Penske has the opportunity to create the first truly post-modern auto company. Penske's Saturn doesn't own a single factory, design studio, or proving ground. What it does own -- and all it needs to own -- is the intellectual property of the Saturn brand.

It's hard to imagine a more perfect candidate to become a post-modern auto company than Saturn. Envisioned by GM chairman Roger B. Smith as an import fighter because of advanced manufacturing techniques that included a highly automated plant and plastic body panels, Saturn succeeded not because the original car was good -- actually, it wasn't even remotely competitive with anything from Toyota or Honda -- but because it was cleverly sold and marketed. Saturn consumers bought into the defining promise of the brand -- no haggle pricing and great customer service -- rather than the physical attributes of the vehicle.

Although GM has agreed to build Saturns for Penske for at least two years, future Saturn models may be sourced from a variety of automakers around the world (the latest rumor has Penske talking with Renault). Saturn could simply rebadge another manufacturer's existing model, paying for U.S. market certification costs and minor cosmetic changes, or it could commission an automaker to design, engineer and manufacture a complete new vehicle. Either way, it could bring new models to market for way less capital cost than a traditional automaker.

Finding someone with spare factory space to build Saturns won't be hard: The world's automakers currently have the capacity to build 92 million vehicles a year, but will be lucky to build 60 million in 2009, says respected industry forecaster CSM Worldwide. And with the global economy expected to recover slowly from recession, there's going to be plenty of spare capacity around the world for a long time yet.

All Penske's Saturn has to do to succeed is sell cars and trucks that deliver on the promise of the Saturn brand. The actual vehicles can be made anywhere, by anyone, and as long as they are competitive with the mainstream players in their respective segments in terms of performance, economy, quality, and equipment levels, it almost doesn't matter what they are, because the

Saturn brand is mostly defined by a classy purchase experience. And if there's one thing Roger Penske knows how to do with class, it's selling cars and trucks.
Posted by Angus MacKenzie

Mercedes, Lexus, and Saturn top ranking of U.S. dealerships

Todd Agostini is glad that luxury auto sales are down right now. The sales manager at the Jaguar dealership in Cherry Hill, N.J., Agostini says that Jags take a discerning eye to appreciate. And the heady times before the credit crunch were bringing in too much riff-raff--customers who didn't fully understand the brand or thecars themselves.

"We couldn't stand selling cars to people who really didn't have any business in our car," says Agostini. "Not that we didn't like the people at all, but it hurts the brand."

It sounds elitist, but Cherry Hill is the No. 17 Jaguar dealer in the country, and No. 1 for used Jaguar sales. The dealership has been able to remain profitable, so far, in an auto market with new-car sales down 36% from last year.

It's partly the cars that keeps customers coming, sure, but it's also the experience those customers have in the showroom. While General Motors ( GMGMQ.PK - news - people ) and Chrysler are closing roughly 1,100 and 800 dealerships nationwide, respectively (and surviving dealerships conjure ways to attract their customers), Jaguar joins several other luxury brands in shining through the recession's haze.

Mercedes-Benz, Lexus and Jaguar are the top three brands when it comes to consumer satisfaction at their dealerships. Along with Saturn and Land Rover, they round out the top five in our list of the best dealerships in the country.

Behind the Numbers To generate our list of the best car dealerships this year, we used data provided by Pied Piper Management, a California-based marketing firm. The numbers were collected between July 2008 and June 2009 using 3,531 anonymous shoppers at dealerships of every automotive brand, nationwide. The prospective car buyers were questioned on many aspects of their experiences at the dealerships, from whether a salesperson smiled to whether they were offered a brochure to whether they planned to purchase a vehicle from that particular showroom.

Pied Pier analysts then used that information to evaluate how effectively a dealership sells cars, to compare particular sales processes to industry benchmarks and to identify deficiencies in certain brands. Each brand was then given a score as a factor of overall sales effectiveness, with a higher score meaning better sales rates, as well as a greater likelihood of brand-exclusive dealerships.

Nine of the 10 highest-scoring brands on our list are in the luxury category; Saturn is the lone exception. Only one of the luxury brands, Cadillac, is from an American automaker.

Fran O'Hagan, president of Pied Piper, says luxury brands are more effective with auto sales because their salespeople earn higher commissions per sale and are willing and able to devote more time and attention to individual shoppers.

Longo Toyota, a dealership near Los Angeles, for instance, is the largest dealership in the U.S. It sells more than 15,000 new cars a year, and shoppers there know that if they want to buy a Camry, they can choose from multiple colors and options and drive one off the lot that day. It's all about the transaction, O'Hagan says.

It's not so with luxury dealerships. "They attract a different type of person," O'Hagan says. "The visit may take two or three times longer than at Longo, but the salesperson is happy to devote that time. People who want to make their living selling Jags or Mercedes tend to be a different type than the people who make their living selling something at a higher volume."

Indeed, Agostini says his typical buyer has already bought two or three vehicles at the Cherry

Hill dealership, and routinely invites salespeople to dinner or to week-long vacations at beach houses nearby.

Changing the Face of Car SalesThe industry average for sales effectiveness has increased dramatically across all types of dealerships, according to Pied Piper, thanks to an economy that forces salespeople to be more vigilant on the showroom floor, O'Hagan says.

The nature of what a salesperson must be in order to close a sale, especially in the luxury sector, has changed, too. While it's still true that shoppers buy from people they like, salespeople are facing a much more educated and sophisticated buying public.

It's not enough to know the product--they've got to convince a prospective buyer that a

Mercedes, say, is better than a Lexus, when so much specific, in-depth information is widely available for both types of cars.

"Product knowledge is dramatically less important than it used to be," O'Hagan says. "It's much more [a question of] 'What can the salesperson do for me?'"

Come and experience the Saturn difference at Saturn of Greenville, Saturn of Asheville, and Saturn of Spartanburg.

Can a billionaire car mogul save Saturn?

Michael Vaughan, Autos.CTV.ca

Roger Penske is an American folk hero. He's the sports car racer who morphed into a billionaire car dealer. He seems to have the Midas touch in auto racing (his team has won the Indianapolis 500 fifteen times) as well as auto sales and leasing (you can rent a Penske truck almost anywhere or you can drop in and buy a car from one of his 250 car lots -- none in Canada).

But now he's taken on Saturn -- not the sixth planet from the sun but a discarded part of the General Motors disaster.

Saturn Corporation was established in 1985 by GM as a "different kind of car company." It was supposed to beat the Japanese at building small cars for the American market. Saturn succeeded in building a small, cult-like following among its buyers for the no-haggle pricing and "Family Reunions" -- but it never made a dime for GM.


The first Saturns hit the streets with dent-resistant plastic body panels. These were supposed to reduce repair costs and let the manufacturer change styles more rapidly. In fact, Saturns almost never changed appearance and the panels were something of a fire hazard.

Since the 2000 model year GM basically gave up on having Saturn separate or "different" and started putting a Saturn badge on cars from their European division -- Opel. They got some pretty good cars this way.


Penske has now waltzed in (financial terms not revealed) and picked up the Saturn brand, parts inventory and the right to distribute vehicles and parts through the Saturn dealership network -- about 350 in the U.S. and 60 in Canada. In addition, GM will continue to produce the Vue, Aura and Outlook for him for the next three years.

So how can Roger succeed where General Motors blew away billions? Well the first point is Penske won't have to worry about the factories that build the cars. This time around Saturn is only going to be a distributor of cars -- other people's cars.

Roger and his team can now shop the world for custom-made cars from other manufacturers that he thinks will fill the bill with his adoring American public.

Sure, he'll make do with the GM stuff -- good stuff by the way -- for the first few years. But in the meantime he'll cut deals with companies like Renault-Nissan to build the cars he thinks will sell.


Nissan has lots of under-utilized manufacturing capacity in the U.S. and it's expected that Roger will wrap himself in the flag and source only "American-made" cars. Flogging Saturns built in China or India wouldn't suit Penske's All American image.

Roger knows how to sell. He started with tires, moved into trucks and now the Detroit-based Penske Automotive Group is the world's second largest automotive dealer group.

Americans instantly recognize him as the serious looking, handsome guy wearing earphones in the pits as his team takes the checked flag. He's the representation of old fashioned American virtues of hard work and team play.


Gearhead blogs since the deal was announced have been overflowing with comments like "We love Roger" and "the guy has a golden touch."

If he pulls off the deal for Saturn, and makes it work, Penske will have caused the biggest change in how cars are sold since the dawn of the auto industry.