Demand for GM's Saturns Stays Ahead of Supply

07/29/96

Saturn Corporation President Donald Hudler told reporters that the Saturn car line could sell an additional 50,000 units a year, if it could produce them. The annual maximum capacity of Saturn's plant in Springhill, Tennessee is 305,000 units, and the company sells as many cars as it turns out each year. Hudler announced that the company had the potential to expand their annual production.

Hudler introduced the redesigned 1997 Saturn SC1 and SC2 coupes, marking the first time the cars have been restyled since fall 1990 when the company introduced them. The new coupes are the last of Saturn's three body styles to go into their second generation.

If Saturn production is stretched to its limits right now, the company's problems keeping up with demand will grow when the division begins producing right-hand drive cars for sale in Japan. Saturn plans to begin producing right-hand-drive models at the end of this year. Hudler made no comment about whether Saturn plans to build cars at a second plant, although he described the notion as "one of the many possibilities we've contemplated."

By the time Saturn starts selling cars in Japan (March, 1997), it expects to have 13 to 15 dealers there. Hudler said. Saturn has not decided how many right-hand drive cars to build. In addition to Japan, Saturn sells cars in Taiwan and Canada, although the United States remains the division's primary sales focus.

Saturn has raised prices for its 1997 cars by an average of 1.9% or $282 per vehicle. Prices for Saturn sedans will rise between 1 and 1.8%, putting the price of a 1997 sedan without any options included up to $12,495 (1996 price was 10,595). Saturn's 1997 wagons have gone up $12,195 and $13,095, price hikes of 1.7 and 1.6 percent respectively over 1996 levels. Saturn hiked prices on its coupes the most, tagging the SC1 with a 2.5% increase and the SC2 with a 3 percent hike; 1997 SC1 will now sell for $12,495 while the SC2 will go for $13,695.

Car buyers who purchase options will pay even more for their cars, as Saturn also put those prices up. Automatic transmission will cost $840 (up 1.2%), air conditioning will cost $930 (up 1.2%), cruise control will cost $270 (up 3.8%).

Paul Dever -- The Auto Channel