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<b>Saab & Jaguar Fight to Survive as GM & Ford Try to Cover the Cost</b><p><b>Detroit Auto News</b><p><BLOCKQUOTE>quote:<HR>FRANKFURT, Germany--European luxury brands Saab and Jaguar needed rescuing by Detroit's automakers more than a decade ago because they couldn't survive alone.<br> <br>Now evidence is growing that both still are having trouble cutting it, despite the deep pockets of General Motors Corp. and Ford Motor Co. and their global luxury aspirations. GM's Saab and Ford's Jaguar each expect to post operating losses of $500 million this year, hardly proof of promised turnarounds.<p>In the white-hot competitive environment enveloping GM and Ford, punctuated by weak stock prices, rising pension obligations and huge health-care costs, such hemorrhaging is unacceptable. Saab blames the costly launch of its all-new 9-3 sports sedan and Jaguar points to the complicated introduction of its aluminum XJ sedan, but there's more at work here and it's not encouraging.<br> <br>GM and Ford underestimated the costs and overestimated the potential appeal of Saab and Jaguar in a world where Mercedes-Benz, BMW and Audi, despite recent troubles with new models, shape expectations and Lexus and Infiniti set the standard for quality.<p>Perhaps the only way these two brands can prosper is to be pushed deeper into the product development, engineering and manufacturing structures of their parent companies. As painful as that prospect may be at Saab and Jaguar, which regard integration as a death knell for their brands, neither can -- nor should -- maintain independence while delivering millions in losses in exchange for billions in capital. <p>Ever since its founding after World War II, Saab has been a quirky car company whose models were overshadowed by rivals, even back home in a Sweden dominated by Volvo. The new 9-3, just arriving in U.S. and European showrooms, is only the fifth all-new Saab in the company's history.<p>Since 1990, Saab's losses have totaled $1.4 billion and the automaker has posted small profits only twice -- in 1994 and 1995. No wonder GM President Rick Wagoner and Chief Financial Officer John Devine have expressed impatience at Saab's performance and failure to become more integrated in GM-Europe's product development, manufacturing and purchasing structure.<p>"We are on the brink of turning this company around," says Saab President Peter Augustsson, conceding that the launch of the 9-3 has been "very tough" and will end the year behind schedule. "We are doing a lot of things right, but we are not earning money."<p>Enter the Detroit cavalry -- in the form of Chief Operating Officer Gregory Deveson and Chief Financial Officer Joseph Peter -- which is arriving in tiny Trollhattan, Saab's hometown, to spearhead a restructuring code-named "Viggen." The result could be fewer jobs, closer alignment with GM's Opel unit in Germany and changes in Saab's dealer network.<p>Saab doesn't have much choice, even if such changes as selling Saabs alongside Opels in Europe and Buicks in the States threatens to tarnish the brand's premium image. Jaguar could be facing the same threat if Ford's new luxury car boss, David Thursfield, draws on the Ford blue-oval in Europe to correct Jaguar's cost, engineering and manufacturing problems.<p>But, then, the alternative is worse for two brands that faced extinction once and lived to tell about it. <p>You can reach Daniel Howes at [email protected]<HR></BLOCKQUOTE><p>-Drew
 

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Re: Saab & Jaguar Fight to Survive ([email protected])

My uncle recently bought a brand new Jaguar X-type. Now he's something like 3 shop hours away from turning it in under the lemon law.<p>Saab has never interested me in the slightest. Heavy cars, FWD, and only 4-cylinders. They need more than that to be competitive. How about some RWD or AWD V6 applications?
 

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Re: Saab & Jaguar Fight to Survive (anony00gt)

I think both brands have potential. It just goes to show what a tough market it is right now. So many manufacturers are on their game.
 

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Re: Saab & Jaguar Fight to Survive (anony00gt)

<BLOCKQUOTE>quote:<HR>My uncle recently bought a brand new Jaguar X-type. Now he's something like 3 shop hours away from turning it in under the lemon law.<p><HR></BLOCKQUOTE><p>Really? <IMG NAME="icon" SRC="http://********************/smile/emsmileo.gif" BORDER="0"> I thought that they had gotten their act together!!!<p>Yannis
 

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Re: Saab & Jaguar Fight to Survive (GrecianVolvo)

I was under the same impression as Yannis. It may have been a fluke X-Type as J.D. Power & Associates and other such ranking systems seem to have given Jaguar quite favorable scores.
 

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Re: Saab & Jaguar Fight to Survive (Ari)

I love these end of the end stories.<br>Saab or Jag going under? Please. Lets see - Saab, along with GM, has one of their best product launches in history - the 9-3SS. It has been praised by everyone who has driven it. Jaguar - I see S-Types everywhere, along with XJ's. (Not many X's, though)<br>Jag is at the top of JDPower, Saab has, from everything I have read - the best qulity European car (9-5), and Saab just got mentioned in Kiplingers for "Best Car between 30-40K", for the 9-5 Aero.<br>This is the type of reporting that sends companies to the brink, by shaking consumers confidence. Reporters also have to learn that cars are big bucks to design, etc. - and their profits may not be realized for years.
 

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Re: Saab & Jaguar Fight to Survive (Ari)

<BLOCKQUOTE>quote:<HR>I was under the same impression as Yannis. It may have been a fluke X-Type as J.D. Power & Associates and other such ranking systems seem to have given Jaguar quite favorable scores.<HR></BLOCKQUOTE><p>Very well could be. Every car manufacturer has a few lemons now and then. Doesn't change the fact that he hates the car and probably would never buy another Jaguar.
 

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Re: Saab & Jaguar Fight to Survive (anony00gt)

Clearly, Jaguar needs to shape up. Jaguar, a few suggestions for you:<p>Revive the halted F-Type program. There is a market, a profits and most importantly an acceptable place for Jaguar in the SLK/Z4/Boxster class.<p>Decide whether the XKE is a competitor to the CLK or the SL/CL. I personally feel they should bring it down to the CLK and then develop a new, two-seater flagship as an SL/CL competitor.<p>Introduce an X-Type R.<p>Share more with Volvo and Lincoln. Selectively, though. Things like platforms are excellent candidates, in particular for the X-Type and S-Type. However, the former should be sharing with the S60 not the Mondeo!<p>End the failed F1 program! Jaguar has consistently poor results, yet spends a whopping $120 million per year on this racing. Either assemble a winning team and get results or quit.<p>Establish a consistent and non-confusing nomenclature to be used across the line. (That won’t necessarily help profits, but it does bother me)<p>Redesign the standard Jaguar interior. The X-Type, S-Type and XJ all have the same interior with little variation. I have no problem with a fairly standard interior, but Jaguar needs to alter theirs. The console is too plasticky. Also, the wood dash does not run into the doors and this makes the interior seem small, I feel. Borrow a few pages from Bentley’s book.<p>Do not go anymore down-market than the X-Type! Jaguar has great prestige. Going the A-Class, 1-Series route would be a <I>huge</I> mistake for them. Also, to preserve this prestige, do not come out with an SUV.<br>
 
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