A Small, Hidden Tragedy

Posted: December 3, 2008 in lean

The global news has been anything but good this past month. With the true human tragedy in Mumbai, India, the financial woes of the Big Three US automakers seems strangely juxtaposed on the list of recent tragedies. Yes, the decline of these companies affects millions of people, but somehow the tragedy of business failures pales against the loss of lives to terrorist actions.

For several years I’ve been discussing the general inability of US automakers to compete in a global economy and today, the CEOs of these company laid out the billions of dollars that they need in government financing to be able to survive.

Hidden in a USA Today article about the bailouts is an assessment of the GM brand, Saturn:

And Saturn, the quirky brand launched in 1990 to win sales from Asian rivals, could be on its last legs. Henderson says the company will meet with its retail network to discuss options, which could include a shutdown, such as GM did to Oldsmobile a few years ago, or selling it.

“We have to do something with the Saturn brand, because frankly, it has not been successful,” [General Motors (GM) CFO Frederick “Fritz”] Henderson says.

During Saturn’s early years it was lauded in business journals and academic case studies on how a conservative American car company, like GM, could emulate the best efforts of Toyota, Nissan, and Honda. The workers at the Saturn plant in Smyrna, Tennessee, were examples of how employee empowerment could yield benchmark levels of quality and productivity.

Unfortunately, over the years, the culture at Saturn eroded and became more and more like the rest of GM’s other brands.

So what looked like a great step forward in American industrial evolution may now end up as footnote in American automotive history.


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