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SATURN - PowerPoint PPT Presentation

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SATURN
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  1. Amy Bolyard • R.J. Gimbl • Spence Graham • Todd Hannah • Bill Long SATURN

  2. Saturn History • Concept began in July 1982 in response to increasing import competition and a traditional adversarial relationship between union and management • Partnership formed between General Motors (GM) and United Auto Workers Union (UAW) • July 1985- Spring Hill, TN selected for Saturn’s manufacturing facility ($1.9 Billion for plant construction, equipment, and tooling) • July 1990- 10:57am, GM Chairman Roger Smith and UAW President Owen Bieber drive red metallic four door sedan off assembly line • Saturn’s Yearly Homecoming draws an excess of 40,000 people per year

  3. Production Trends • October 1990- 1st truck load of vehicles shipped from Tennessee to California • March 1992- Sells its 100,000th car • Sept. 1993- Produces 500,000th car • June 1995- Produces 1 Millionth car • January 1997- Produces 1.5 Millionth car • January 1999- Produces 2 Millionth car

  4. The Saturn Family SL-1 • MSRP- $12,955 • Well Equipped and Easy to Live with • Estimated EPA of City 29 and Highway 40mpg with manual transmission

  5. The Saturn Family SL-2 • MSRP - $14,365 • Well Equipped and Affordable • 124 Horsepower Engine • Tight, Sport-Tuned Suspension

  6. The Saturn Family SC-2 • MSRP - $17,115 • 3rd Door for Easier Access to Rear Seat • Road Hugging Suspension System • 5 Speed Manual Transmission • 1.9 Liter Dual-Overhead Cam Engine

  7. The Saturn Family SW-1 • MSRP- $15,615 • Roomy and Comfortable • Standard Air and Lumbar Seats • Flexible Door Panels to Prevent Dents- Easily Removable and Replaceable

  8. Strengths & Weaknesses • Price • Quality • Lack of Dealers • Lack of Support from General Motors • Higher consumer loyalty rate than Toyota and Honda with 45.6% of Saturn owners repurchasing a newer model Saturn • No Hassle/No Haggle Buying Experience • Rank highest in Sales Satisfaction (Nameplate Ranking) from 2000 JD Power and Associates

  9. Target Customers • Free Spirits SC-2 (2 Door Sport Coupe) • Commuter SL-2 (Fully Equipped Sedan) • New Families SW-1 (Station Wagon) • Economizers SL-1 (Economy Sedan)

  10. Decision 1- Year 2 Qtr. 2 • Projected car sales of 60,700 • Production was 56,000 vehicles • $100 rebates on the SL-1 and the SC-2 • 7.5% finance rate • Advertising budget of $22.4 million • Targeted Free Spirits, Commuters, New Families.

  11. Results- Year 2 Qtr. 2 • Actual Vehicle Sales 53,016 • Net Contribution -$17.6 M • Gross Margin $22.5 M • 8.3% Unit Share • 316 Dealers • 168 Vehicles sold per Dealer

  12. Decision 2- Year 2 Qtr. 3 • Projected car sales of 58,200 • Actual car sales were 61,437 • Production was 57,000 • Offered $250 on the SL-1 and SW-1 models • 3.9% finance rate • Advertising budget of $25 million • Targeted Suburban and Urban Consumers • Upgraded quality (60%) price (40%)

  13. Results- Year 2 Qtr. 3 • Actual Vehicle Sales 61,437 • Net Contribution $8.7 M • Gross Margin $65.6 M • 9.7% Unit Share • 316 Dealers • 194 Vehicles sold per Dealer

  14. Decision 3- Year 2 Qtr. 4 • Projected car sales of 60,400 • Actual sales were 55,504 • Production was 57,000 • Rebates of $500 on SW-1 and SC-2 and $150 on the SL-1 • 2.9% finance rate • Advertising budget of $24 million • Price was increased by 1% as price and quality upgrades took effect. (Inflation 3%)

  15. Results- Year 2 Qtr. 4 • Actual Vehicle Sales 55,490 • Net Contribution -$0.1 M • Gross Margin $57.8 M • 9% Unit Share • 381 Dealers • 145.6 Vehicles Sold per Dealer

  16. Decision 4- Year 3 Qtr. 1 • Projected car sales of 62,900 • Production was 57,500 • $1000 rebate on SL-1 and SW-1 and $500 rebate on SL-2 and SC-2 models • 1.9 % finance rate • Advertising budget of $24 million • New model introduction rejected

  17. Results- Year 3 Qtr. 1 • Actual Vehicle Sales 61,654 • Net Contribution $20.8 M • Gross Margin $92.5 M • 9.9% Unit Share • 400 Dealers • 154.1 Vehicles Sold per Dealer

  18. Decision 5- Year 3 Qtr. 2 • Projected car sales of 62,500 • Production was 57,500 • $1000 rebate on the SL-1, $750 on the SW-1 and SC-2 • 1.9% finance rate • Advertising budget of $24 million

  19. Results- Year 3 Qtr. 2 • Actual Vehicle Sales 64,683 • Net Contribution $39.3 M • Gross Margin $109.6 M • 10.6% Unit Share • 400 Dealers • 161.7 Vehicles Sold per Dealer

  20. Saturn Revenue

  21. Inventory

  22. Contribution

  23. What to look for in the future: VUE Sport Utility