The "New" G.M. Sounds Dangerously Like the Old, Dead Saturn

"The General Motors Corporation today displayed the prototype of a small car intended to someday match similar Japanese cars in cost and match or exceed them in quality."

So wrote The New York Times on November 4th, 1983.  And yesterday, with the withdrawal of Penske as a potential purchaser of Saturn, the "someday" of that distant, gauzy announcement has turned out to be never.

Saturn is vanishing from the face of the road, and with it will disappear the first new GM division since Chevrolet in 1918 – and an entire fleet of hopes that surrounded its introduction.

But here’s the real scary part.  When you look back at the swirls and eddies of hype that surrounded the launch of Saturn, those promises sound exactly like the assurances we’re getting about the glimmery future of the new GM.

Trust me, go to the G.M. "reinvention" website and they proclaim: "See how we’re reinventing the automobile and our company."  It’s the same promissory script, with largely the same cast. 

Let me try to paint a picture of the extraordinary hope that Saturn represented at the time, because it’s a microcosm for the jubilation that’s pouring out of a post-bankruptcy G.M. about a leaner and more nimble company.

We were repeatedly promised that Saturn was a long-overdue and self-imposed shock to the system: a new era of innovation in both corporate structure and manufacturing; a new vision of labor and management partnership; a new relationship with consumers that included "no-haggle pricing." 

Back in 1983, and that was more than a quarter century ago, the Times reported that Saturn was going to be "a departure from traditional practices and would reflect the technological ferment under way in the once-complacent auto industry as it tries to out-do the Japanese."

Flash forward: the allegedly new, post-stimulus General Motors is also supposed to up-end their Soviet-style bureaucracy and create a leaner, meaner, Japanese-and-Korean fighting machine.

Well, as Saturn inched towards launch, the Japanese continued to drive innovation with their relentless, fast-track rigor.  G.M.’s share continued to slump.  Meanwhile, it took until 1990, seven years later, for the first Saturn to be shipped. 

The L.A. Times story on October 12th announcing the event began with this ominous sentence:

"By its own admission, General Motors Corp. has only one more chance to prove that it can design a small car that can compare credibly with the Japanese."

The story went on to note that Saturn boasted a radical leadership structure that was jointly managed by the president of Saturn and a United Auto Workers officer.  GM had undertaken "…a clean-sheet approach.  The project was staffed with volunteers attracted to the idea of cutting through some 80 years’ worth of corporate insularity, acrimonious labor relations and other ills…"

The article wrapped up chilling prescience: "The importance of the venture goes beyond GM’s own fortunes.  It is also seen as a test of America’s ability to rebound from the beating its own manufacturing sector has taken at the hand of foreign competitors."

The launch was relatively successful.  "Shortages seem inevitable" crowed the L.A. Times, and it appeared that Saturn has a fighting chance.

But there were already skunks at the picnic.  A few months later, in March of 1991, a gimlet-eyed New York Times conceded that "’s clear that the $2 billion project has not produced a revolutionary car."  Why didn’t it?  Why couldn’t the no-holds-barred innovation culture at Saturn produce something miraculous, the iPod of its day?  If there were talented designers at GM who were being choked by the system, why didn’t their lungs bloom when the corporate foot was lifted from the oxygen supply?

Part of the tragedy of Saturn’s demise is that in its early years, the car developed a true cult following.   The apogee of which was an owners’ rally that was so successful the media gushed over the product intoxication the new GM division had created.  The Washington Post headline read "What if You Had a Party and 28,000 Saturn Owners Showed Up?"

The story went on to describe a scene where "There were children everywhere, running through fields and playing on bales of hay, while their parents huddled in groups and talked about God, family, country - and Saturn."

The New York Times said "It is without exaggeration that many Saturn owners call themselves groupies, fanatics, even members of a cult. That zealousness has been skillfully cultivated by Saturn, a subsidiary of the General Motors Corporation and perhaps the nation's most fervent practitioner of "relationship marketing."

G.M. had something great going.  What went wrong?  Well, their "skillfulness" was transitory.  They couldn’t keep the consumer relationship fresh or the momentum going.  They failed to move quickly enough into the web and social media – the ultimate relationship marketing platform.  And the cars themselves, never innovative, oozed into boredom.   They let down their fans.   Disillusioned, the cult scattered.  The "clean sheet of paper" became an obituary.

It’s hard not to view the failure of Saturn as a grim augury of G.M.’s prospects.   They had more than twenty years of relative luxury to create a shining, independent laboratory of innovation and they squandered the opportunity.  Now, time is against them, and there’s less reason than ever to believe they can pull it off.

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