Saab Aims to Move 50,000 9-5 Models Annually

By Kevin Miller

09.17.2009

2010 Saab 9-5In Frankfurt this week, Saab’s Managing Director Jan Åke Jonsson said the global sales target for the sedan and station wagon versions of the company’s new 9-5 is 40,000 to 50,000 per year, according to Automotive News. While the car looks great and should be very competitive in the market, the Swedish automaker may have a difficult time moving quite that many units.

As we reported last month, Saab’s new owner is inheriting a fractured dealer network in many parts of the world. GM has announced that the Saab dealer network in Canada is being shut down at the end of this year. Dealer numbers in the US and in several European markets have decreased in the last 18 months. With fewer retailers, thereby located farther from some potential customers, it may be difficult to grow sales of the large 9-5 to the point of being able to sell 50,000 annually. Saab’s Jonsson did state that the company plans to develop a new sales network in the US after the separation from GM is complete, which means that initiative will begin sometime in 2010.

Fortunately, the potential for growth into new markets does exist.  Following last week’s announcement that China’s Beijing Automotive Industry Holdings Co. (BIAC) has invested in Koenigsegg Group’s purchase of Saab from GM, it is possible that BIAC could serve as an importer or set up a retail network for the Swedish cars in China. GM introduced Saab to the Chinese market five years ago; fewer than 900 Saab vehicles were sold there in 2008.

Koenigsegg Group has stated that they expect Saab to return to profitability in 2012, with a sales volume around 100,000 vehicles. They will need to sell 40-50,000 9-5 models annually to reach that overall sales goal, but in today’s marketplace that number seems more than a bit out of reach. In 2008, Saab sold fewer than 67,000 9-3 and 9-5 vehicles globally.

With the new 9-3x and 9-5, and the upcoming 9-4x, there will finally be new models in Saab’s showrooms. The 9-5 sedan will be on sale in Europe early in 2010, and in the US midyear. It will be followed next Autumn by the 9-4x, with the 9-5 wagon showing up in early 2011.  With that being the case, the 50,000 9-5/year target wouldn’t come before the 2011 launch of the wagon, which gives Saab just a year of sales to ramp up to the mythical 100,000 unit break-even point. The calculus of Saab’s return to profitability seems a bit optimistic if it is really relying on such strong annual sales- though the company would already be shuttered if they weren’t optimistic about their future. Time will tell if they are able to achieve those sales numbers and return to profitability.

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Author: Kevin Miller

As Autosavant’s resident Swedophile, Kevin has an acute affinity for Saabs, with a mild case of Volvo-itis as well. Aside from covering most Saab-related news for Autosavant, Kevin also reviews cars and covers industry news. His “Great Drive” series, with maps and directions included, is a reader favorite.

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6 Comments

  1. The problem for Saab in America isn’t just the shrinking dealer network. It also that the brand itself has been devalued. The new 9-5 is going to be expensive. Many potential buyers will see the price as too high for a car with the 9-5’s features and a Saab badge on it.

    They will drive over to an Audi or BMW dealer and pay that amount for the same features on a car with one of those badges, no problem.

    That is Saab’s problem.

  2. Sure. Put a Konigsegg powerplant in the new 9-5 and sell it for the same money and then you might sell 50,000.

  3. Linus here again.

    Saab was even with BMW thirty years ago in the U.S. in terms of brand catchet, and way ahead of Audi. Now they’re behind both those German luxury brands. They’re no better off than VW is in terms of being able to get luxury-car money for a car with their badge on it.

    It can be done, but not too often, as the failure of the W8 Passat and the Phaeton show.

    People just don’t believe Saab belongs up there with BMW, Audi, and definitely not Mercedes. Even their Swedish rival Volvo has better brand power.

  4. Hard to see how that can happen without heavy incentives.

  5. Not going to happen. Especially not with a four-cylinder engine.

    Linus: I was around 30 years ago, and while the Saab 900 had about as much cachet as a 320i, the Saab brand was not even with BMW. Maybe Audi and Volvo.

    The thing was, back in the day the Saab brand wasn’t about cachet. It was about having a thoroughly idiosyncratic car. GM’s mistake was in thinking that in buying Saab they were buying a premium brand.

  6. SAAB sells only two true SAAB models in two markets and just barely so: the U.S. and its home market of Scandinavia. Outside of these two markets run-of-the-mill SAABS are about as common as Audi R8 supercars.

    There was a day in the late 1980s when the SAAB 9000 had garnered a fair share of respect. It was based on a FIAT designed chassis which it shared with the Lancia Thema and Alfa 164, the former having been graced with a Ferrari engine and the latter having achieved respectable sales in Europe. These associations signaled that SAAB seemed willing to move away from quirkiness in order to be perceived as more mainstream entry level sporty luxury.

    And then something funny happened. Lexus, Acura and Infiniti were spawned. Mercedes by then was well established marque and BMW’s then recent successes with its esteemed M street cars launched that company into the high heavens. The rest faced an onslaught from the Japanese upstarts (in the US market) reminiscent of what Bambi faced when he encountered Godzilla.

    Volvo managed to find a then strong backer (Ford) to finance development of its product line away from the square and stodgy, still leading the industry in areas safety technology. Ford managed to boost the Volvo and Jaguar/ Aston Martin image.

    Saab, on the other hand, was adopted by GM. Arguably at the time it offered a product far superior to what was found at Cadillac. Yet GM had lofty aspirations for restoring global glory to Cadillac particularly in Europe. Could it be that SAAB was perceived as an impediment to Cadillac’s success in Europe? The facts are these: The attempt to market Cadillac in Europe failed miserably. And the only real model expansion at SAAB came more than decade after the absorption (and likely a decade too late). In what many considered an act of “smoke and mirrors” GM turned a Subaru Impreza into the 9-2x and a Chevy Trailblazer into the 9-7x.

    What happened to SAAB is reminiscent of the neighbor who promises to water your garden when you take your two week summer vacation and you come back to find it bone dry. Perhaps with a little bit of “water” from the Koenigsegg fountain the SAAB marque can make a go of it.

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