When it debuted, Saturn got a lot of attention for GM, but it was dissolved 25 years later. Find out why in this look at the Saturn car company.
There are dozens of car companies that started up, saw success, and ultimately failed for one reason or another. Saturn is one of those companies. What started as an innovative approach to car manufacturing (one that was well-received by the public) ended up being a financial drain, mismanaged, and hurt by failed attempts at improvement. Saturn still managed to survive for 25 years, though. Learn more about its inception, some of the highlights, and some of the mistakes that were made.
Starting up the Saturn Corporation wasn’t an easy process for General Motors, but it was kind of quick. In under a 10-year span, it went from an idea to a new option for the eager American car buyer. Though Saturn officially launched on January 7, 1985, that launch was the result of several years of meetings, discussions, and planning.
It was in June of 1982 that General Motors began a project (codenamed “Saturn”) on a new, small car. Alex C. Mair, the then Vice President of GM’s Advanced Engineering Staff, headed up this effort. The idea behind Project Saturn was to compete with the smaller, efficient, cheaper, more appealing cars from Japanese automakers like Toyota, Hyundai, and Honda. Read our classic matchup: 80s Nissan Sentra vs Honda Civic to understand why American car buyers were interested in some of those Japanese vehicles in the 1980s.
GM’s effort to compete against popular models like that was likened to the space race of the 1960s when various countries were trying to make it to outer space first. That’s actually where the Saturn name came from. It wasn’t based on the planet, but rather the rocket that carried astronauts to the moon. While it was Apollo 11 that first carried Buzz Aldrin and Neil Armstrong to the moon, the Saturn V was used on five other trips to the moon, too.
GM purchased land in Spring Hill, Tennessee to build a manufacturing plant soon after the announcement. Construction on the plant began in 1986 and was completed by 1988. Workers were hired soon after and, by 1989, the first Saturn dealers were up and running. The initial startup costs for Saturn are estimated to have been close to $5 billion. Trouble for Saturn and GM started almost right away because that amount came from other car projects within GM’s additional divisions. That caused hard feelings from some of those other brands.
The formation of Saturn meant that numerous American nameplates were under the GM umbrella. The other names included Buick, Cadillac, Chevrolet, GMC, Oldsmobile, and Pontiac. Although GM already those other companies, Saturn was the first car division added to their umbrella since 1918. The plan was to create a separate company, based in Detroit, with its own manufacturing plants, labor contract, and dealer network.
To achieve that goal, GM met with the United Auto Workers in 1983, eventually reaching a labor deal. Labeled as, “a different kind of car company,” Saturn negotiated with the UAW on a number of items. It was the first time one of GM’s divisions would negotiate separately from GM. The two sides reached a deal that involved workers taking a 20% pay cut, but also being guaranteed profit-sharing, among other things.
Saturn also utilized “no-haggle pricing” for its customers. It was a new, appealing tagline and approach promising that advertised prices were final. There were no hidden costs involved, making it easier for car shoppers to compare prices.
The first Saturn prototype was introduced in 1984, but it took years of testing before a production model became available. In 1990, the 1991 S-Series was produced as a sedan and as a coupe. S-Series models were powered by a 1.9-liter four-cylinder engine or a twin-cam version. The base models delivered 85 horsepower, but the twin-cam put out 124 horsepower. Both were mated to either a five-speed automatic transmission or a four-speed manual. It was noted as a very fuel-efficient vehicle in the early 1990s.
The Saturn S-Series Sport coupe and Sedan Level models won awards from Popular Mechanics and MotorWeek for design and engineering, as well as the best small car. In 1991, the S-Series entered the Canadian market, too. Taiwan added the Saturn S-Series to its import list in 1992. A station wagon was added to the 1993 lineup. It was in 1993 that Saturn built its 500,000th car: Carla. By May 1995 Saturn had made one million cars already. Saturn received more good news in 1997. Japan was importing the second-generation S-series sedan as well. January 1999 is when Saturn crossed the 2 million S-Series mark.
Hoping to keep that momentum going, Saturn made improvements to the S-Series. A 1999 redesign included adding a rear-hinged door to the Sport Coupe, and a 1.9-liter inline-four delivered 100 horsepower while a twin-cam engine got 124 horsepower. The engine upgrades also increased fuel efficiency, earning 34 miles per gallon (MPG) on the highway and 23 MPG in the city according to Environmental Protection Agency estimates.
Despite the popularity of the Saturn S-Series models, GM wasn’t making money with them. With a manufacturer suggested retail price of as low as $11,295, Saturn wasn’t recouping production costs. In fact, it was losing nearly $3,000 on every car it sold.
There was something different about these new vehicles. The L-Series, for example, was produced at a GM plant in Delaware. It was also based on the Opel Vectra. Opel was GM’s German division. General Motors started rebadging its models in a lot of ways. While the Opel was rebadged as Saturn in the U.S., the Saturn Sky (made with GM parts) was shipped to South Korea as the Daewoo G2X.
Saturn introduced the Vue in 2002, the company’s first compact crossover SUV. Then the Saturn Ion replaced the S-Series in 2003. The Relay minivan debuted in 2005, the Outlook crossover followed in 2005, and the Sky roadster was unveiled in 2007.
One way to grow the Saturn brand was by offering additional vehicles besides just the S-Series coupe, sedan, and station wagon. That’s why the L-Series was introduced in 2000, just the second model that Saturn developed. It was available in sedan and station wagon body styles.
While GM was trying to expand the Saturn lineup and make it profitable, the majority of these vehicles weren’t as welcomed as the S-Series was in the early ‘90s. Overall automobile sales dropped 18% during the economic downturn in 2008, but Saturn sales dropped 22% that year. GM continued shifting things around at Saturn. Eventually, the L-Series was replaced by the Aura. The Saturn Ion was replaced by the Saturn Astra, almost identical to the Opel Astra over in Europe.
This decision left uncertain futures for Saturn, Pontiac, Saab, and Hummer, all brands that GM owned as well. They’d either be sold, consolidated, or closed. Though GM received $7.4 billion in bailout money in 2008, the company still ended up filing for bankruptcy on June 1, 2009.
Meanwhile, GM was losing money. They posted a $31 billion loss in 2008, losing $9.6 billion in the fourth quarter alone. During a congressional hearing in December 2008, General Motors announced intentions to focus on Chevrolet, Buick, GMC, and Cadillac. Those were the brand’s bigger moneymakers.
The two groups dissolved their labor contract in 2004, allowing GM to move Saturn production out of the Spring Hill, Tennessee manufacturing plant. Saturn vehicles would then be built in various GM facilities. It all ended up being detrimental to the once independent part of GM.
The factors that set Saturn apart, in the beginning, all became things that GM wanted to change. They wanted more and more GM parts included in Saturn vehicles, but with the Saturn nameplate. Disagreements started happening between GM and the United Auto Workers, too.
Frederique LeGreves, Renault’s chief spokeswoman, said “The business case just didn’t add up.” She continued, “It’s just that the math wasn’t happening.” GM hoped to stop production of Saturn models in late 2011, but, without Renault, Saturn dealers were told that closing up shop was imminent. GM stopped production on October 1, 2009.
Even though Saturn wasn’t a priority for GM, they were very open to selling it. One of the most promising offers came from racecar driver Roger Penske. His idea was that French automaker Renault and Japanese automaker Nissan would partner in order to supply cars to Saturn. That arrangement never came to fruition because the Nissan-Renault deal collapsed, so the negotiations between Penske and GM for Saturn fell apart as well.
There have been some calls to bring Saturn back, maybe even as an electric vehicle brand to go with its goal of being fully electric by 2035, but none of it has amounted to anything. Companies have certainly revived defunct brands before. GM even revived Hummer, positioning it as an EV super truck in 2020. Bringing Saturn back in some shape or form isn’t out of the question, but it doesn’t seem likely to happen anytime soon.
While Saturn doesn’t exist in any form today, slivers of it continued. GM rebadged the Saturn Vue as the 2012 Chevrolet Captiva Sport, but without the hybrid version that was available with the Vue. General Motors dealers still service Saturn models, supply parts, and resolve recall issues, too. Of course, there are still plenty of used Saturn vehicles listed.