Essay by parvezUniversity, Master's September 2014

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Saturn Case

Five Forces

Rivalry among competition


Many Players

Fragmented Market

Threat of New Entrants


Many, Huge Players

High Fixed Costs

Efficency required for production

Labor laws strict

Threat of Substitutes


Many alternatives

Rail, buses, taxis, etc.

Bargaining Power of customers


Many companies

Many options

But new policy is there to reduce it

Zero bargaining pricing by Saturn

Bargaining Power of Suppliers


Saturn manufacturs mostly internal

Suppliers located nearby and dedicated

Others get supplies from many suppliers



Good Image and liked by most consumers

66.3 will buy the same

91.8% satisfaction

Caters to younger crowd: 18.5% under 30

Highest satisfaction with quality exhibit 8

Highest satisfaction with selling process exhibit 8

Best + dedicated retail outlets

Lowest List Price in 1993 exhibit 8

Highest Franchise Value rating

Winner of awards

Custom built plant with japenese work ethics

Highest selling small car in 1993 with 11.46%

market share

Joint venture with Toyota in California (Labor issues, quality, cost, management, etc.)

Partnership with union with more decenteralization and employee liberalization

Good brand image

One price policy

Backed by the largest automobile manufacturer GM

Return Policy


Fall in knowing what customers want exhibit 6

Can put more focus on keeping prices low and raising quality as required by customers exhibit 3

Can focus more on fuel efficency

More in R&D

Limited product line


Import opportunities growing all over the world

Customer like Saturn and is a competitor of imported cars


Risky positioning with many close competitors (Toyota, honda, Nissan, mazda, mitsubishi) Exhibit 4

NADA dealer survey shows fall in most values Exhibit 5

Easy to copy strategies


Customer Baby Boomers, 30-40 years, trends and price focused

Geographic Located in major cities of USA

Niche Small car but good quality segment

Operational Strategy...