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Re: Niche is good if profitable
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Posted by Snowmobile [Email] (#686) [Profile/Gallery] (more from Snowmobile) on Tue, 9 Dec 2014 06:59:51 Share Post by Email
In Reply to: Re: Niche is good if profitable, A1-turbo, Mon, 8 Dec 2014 11:14:59
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Fair enough. For sure the recession and GM's state were major factors.

I'm not really sure the break even point per vehicle etc, but I do wonder if selling cars at $10k off sticker (or more) was great for the brand. I do think it changed the type of customer to some degree (obviously not entirely), and while some might think that doesn't matter, I'd argue it does when you are small. SAAB used to have a highly desirable clientele demographic. Is every sale a good sale? Maybe. Maybe not.

My point wrt chasing price as a small manufacturer is that it is something that rings true in very many industries - if you are small, you need to have manageable volume and good profit, so it is better to do things well and get paid well for your efforts than just chase price... whether it's beer, hifi, furniture making, cars, whatever. The alternative is to become big and compete head on with the big boys, but one has to ask "is that feasible?". As a small furniture maker, would it make more sense to focus on design + craft, and build a higher priced very well made furniture for affluent and discerning buyers... or, would it make sense to design a line of veneer covered particle board and try to undercut Ikea?

Over on some of the other forums in the past (eg SU), there have been some who advocate that SAAB make a smaller cheaper car, and others who claim their hyundai or optima is a far better car (than their 10 year old not necessarily well maintained SAAB), or whatnot, and it kind of makes me wonder... I don't actually think SAAB should strive to be more like Kia. Not because Kia's business model doesn't work, but because the value system doesn't match Swedish values and the labour rates don't match either. I don't think it is wrong - I just don't think it is right for SAAB. I suppose it is all moot anyway with the current situation.

I'm not trying to imply that you are suggesting otherwise or anything, but I really do agree with No Snaab - if the product is great and unique, people will want it for what it is. Heck, look at the success of Mini. Sure it is owned by BMW, but it has practically made it's own class of car in North America simply by being different. Actually, I think the marketing around here for mini is "Think Differently"... sounds kind of like the SAAB of old!

wrt BMW - I think they tried the hatch experiment before (and failed miserably). Some of it comes down to design and execution. I buddy who knows BMWs says the 3 series gt is not great - a bit of an "old man's car" but I think he was more keen on the 4 series gt. Both look fairly nice imho. I wonder if they are trying this again knowing that some former saab owners might look to them? But to be honest, many og9-3 types around here moved on to Imprezas, and a well equipped WRX hatch is not really any cheaper than a SAAB in these parts, and they sell like hotcakes.

Apologies for the length!
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