Saabaru

[barslut]

SAN DIEGO - Saab is aiming its Subaru-derived 9-2X hatchback at what it sees as a rapid-growth segment: premium compacts.

"We're bringing this vehicle to market very quickly because we wanted to be among the first in this emerging segment," said Debra Kelly-Ennis, president of Saab Cars USA Inc., at a press event here.

Total U.S. sales in the niche were about 45,000 in 2003. But Saab projects sharp growth - 125,000 to 150,000 units annually by 2006 - and it wants 8,000 of them to be 9-2Xs.

Saab's projection assumes that car buyers in the United States will pay more than $25,000 for the small, luxury-branded cars that are common in Europe.

But industry analysts question whether import brands can draw in mainstream buyers for small cars that cost as much as, for example, a low-end Ford Explorer. The other risk is that smaller cars, however well equipped, might tarnish premier brands.

Competitors are the Acura RSX and Volvo S40. But Saab expects entrants such as the Audi A3, BMW 1 series and Mercedes-Benz B class, Kelly-Ennis said.

Saab's primary target for the 9-2X is a young buyer who is on a budget but eager to own a luxury car. Base prices, including destination, are $23,685 for the Linear model and $27,645 for the Aero.

Kelly-Ennis said the 9-2X will offer buyers their first chance to buy a premium brand. "This is probably at the top end of what they can afford," she said.

The 9-2X is based on the Subaru Impreza WRX, with a restyled front end, rear and interior. Saab also has tuned the handling for a slightly smoother ride and added insulation to reduce interior noise.

Those will be key selling points, as well as all-wheel drive, Kelly-Ennis said.

Analysts say the 9-2X has a decent chance of attracting customers to Saab. But they are skeptical about the prospects for European-style premium compacts in the United States.

Doug Scott, senior vice president of NOP World Automotive in Southfield, Mich., says that when mainstream U.S. buyers spend $25,000 to $30,000, they opt for bigger vehicles.

"Will any of this come out of the domestic marketplace?" Scott says. "The answer is probably no." The segment will cannibalize the import marketplace, he says.

The Mini Cooper S is probably the closest thing to the segment today, but even that isn't quite the same sort of vehicle as a 9-2X, Scott says.

"We don't have a good marker right at the moment," he says. "It's a tough call to say that this market is going to be exceptionally strong."

Jeff Schuster, director of North American forecasting for J.D. Power and Associates, says this will be the first time that U.S. car buyers see small cars bearing nameplates such as Saab and Mercedes-Benz.

Schuster cautions that prestige brands might dilute their images with small cars. But for some shoppers, the lure of an affordable vehicle might be powerful.

"If you're going after an import-minded buyer who puts a European brand up on a pedestal, they might go for it because they can afford it," Schuster says.

Saab spokesman Kevin Smith says most buyers will be new to Saab. He says the 9-2X tested well with young, urban males.

Chip Wilkerson, Saab brand manager for future vehicles, says the 9-2X will come to market June 1, a month earlier than expected. That is because it passed pre-production quality tests quickly, he says.

But, Wilkerson adds, Saab is eager to get into the premium-compact fray, with several competitors coming within the next year: "We see the premium compact segment really coming to life in North America."

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[bigpoppanils]

that car is too much money. I dont see why anyone would pay a $3000 premium over an Impreza, especially considering that the usual Saab standard features (leather, good sound system, etc) are not standard in this car.

i also dont udnerstand why Saab is susing the Subaru automatics. Saab has a lot more expereince in making automatics for turbocharged cars, and its automatics are much more efficient.

For example: the wrx manual has a 0-60 time of 5.7 seconds. the automatic? 8.7 seconds.

the saab 9-5 Aero manual has a o-60 time of 6.5 seconds. The automatic? 7.5 seconds.

stupid stupid stupid.

[cintron]

Schuster cautions that prestige brands might dilute their images with small cars. But for some shoppers, the lure of an affordable vehicle might be powerful.

i dunno. I'd be more worried that "presige brands" [saab?] might dilute their image by BLATANTLY COPYING DESIGN LAYOUTS from another non-prestige manufacturer.

whatever genius at GM thought up this concept should be shot

[barslut]

i just like saying saabaru