SHARE THIS ARTICLE

 I remember years ago a car company sprang up that painted a vision that captivated an audience.

 Born from a big honking Goliath of a company, Saturn came to market in the early 90’s with a product line that was at best subpar compared to its modern day competitors, but the messaging and image created by the brands marketing team birthed a class of people who fell in love with Saturn.
 
Remind you, this was all before Facebook, Twitter, iPhone and most of the modern things we take for granted now existed.  But Saturn created a want, a need and a desire amongst its customer base.  And out of a little factory in Spring Hill Tennessee (about an hour south of Nashville) a new vehicle was born.
 
Truth be told, I wanted a first generation SC2.  It was cool, it had flip up headlights, was reasonably quick for the time, and most importantly priced at around $13K was in theory affordable.  Of course, I was also but a junior in High School so while I wanted one, and on several occasions was able to con a sales rep (Saturn had a no-haggle pricing strategy) into a test drive, the truth was without a job and any prospect of a job given where we lived at the time, there would be no Saturn parked in my driveway.
 
But fortunately for Saturn, hundreds of thousands of people did find room in their garage for a Saturn, and a sort of quasi vehicular cult was formed.  The Saturn faithful.  Not wanting to miss an opportunity to capitalize on a subpar product with a customer base willing to overlook the obvious fact that any Honda or Toyota of the day was in fact a vastly superior product, Saturn invited its cars back to Spring Hill for a reunion, and the owners of those cars were allowed to join in the fun and festivities.
 
We all know Saturn eventually failed, unable to deliver a superior product in a crowded marketplace.  Whereas Honda and Toyota was and continues to be on a very intentional deliberate march to continually improve their vehicle offerings, Saturn brought out a simply terrible warmed over version of their first models and rebadged mid-size car that just wasn’t at all what Saturn started out to be.  Where GM originally planned to be hands off and let Saturn be its own brand, the simple economy of scale dictated badge engineering and as such before it all ended a simply terrible SUV with a Honda sourced engine along with one of the worlds ugliest minivans wore Saturn badges.
 
And as such the brand died and Saturn along with many other brands rode off into the sunset with barely a soul really missing its absence.
 
I can’t help but look at Tesla and see all the markings of a Saturn style ride into the inevitable sunset of brands that no longer exist.  
 
Tesla has a tremendous fan base and good will with its customers.  Tesla has something truly unique, much like Apple they have a huge potential customer base for product.  But unlike Apple whose customers know that when Apple says their newest iPhone X will ship in 2-3 weeks, Tesla thus far has been unable to deliver on its most important product to date.
 
And there isn’t a solution or revised delivery schedule yet that any reasonable person can accurately rely on given the track record of each and every delivery date thus far across ALL product lines being missed.
 
Tesla is a great idea that has managed to crank out a few niche vehicles in a very competitive marketplace, but a large scale manufacturer its not.  And just like a Saturn homecoming in Spring Hill, Tesla can produce all the verbiage it wants in an attempt to keep the base excited, but in the end if it is unable to actually produce cars in any meaningful volume, the fact is it will die (or be absorbed).
 
And we know what being absorbed does to a brand.  Think of Saab being absorbed by GM.  Saab had a crazy faithful customer base, what Saab didn’t have was customers who thought driving a warmed over Grand Am (G5) that happened to have its ignition switch moved to the center floor qualified it to wear the Saab badge.
 
As I fought the crazies at Walmart I saw a Saab SUV, I wouldn’t have known it was a Saab but for the badging as it was in fact just a GM SUV in disguise.
 
And just like Saturn, Saab faithful dispersed and moved on to other brands.  Whether their allegiance and loyalty to what they now drive is still in effect I don’t know, but what I do know is that they aren’t loyal to that which they can’t have.  And most are smart enough to know that a GM badged “Saab” is not the same as a Saab.
 
And likewise, assuming Tesla got absorbed, would a Ford or GM branded Tesla have the same cache as a Tesla as we know it today?
 
My guess is, “No.”  But not for the reasons you might think.  Here’s the thing.  Ford and GM know how to crank out cars in mass, they know what it takes to get a car to market, and they know how to deal with manufacturing issues because they’ve been dealing with them for the last hundred years or so.  I’m not being critical of Tesla, but many a person has tried and failed, and credit does go to Tesla for being able to turn out as many cars thus far as they have, but the reality is despite the love affair investors have had with Tesla, there is no reasonable person alive that can argue that Tesla is somehow worth more than a Ford or GM when it comes to valuation.
 
Can Tesla survive.  If I was a wagering man I’d bet against it.  Could I be wrong, you bet.  But more than see it fail, I’d love to see it survive and be ran in such a way that the product got to the people.  But a caveat there again must be raised, it is all when and good to deliver a product that is being subsidized by the American taxpayer.  Let the product speak for itself in a competitive marketplace and allow the market to decide instead of putting money on the hood of every vehicle sold.
 
Toyota faces that challenge with the Prius, a surprisingly good car that is $3-4k more expensive than a comparable sized Corolla or Civic, and yet people choose the Prius as a way to make a statement about issues they value.  Likewise in an environment that isn’t subsidized allow the buyers to make the choice.  If a $35k Model 3 makes more sense than a loaded Accord or base 3-Series BMW to a potential buyer, Tesla will start to see market share grow.
 
So whats the solution to Tesla?  To be honest with you I don’t know.  What I do know is absent any substantive product volume, it will fail regardless of how good the product might be.  Level the playing field taking away tax incentives and let Tesla sink or swim just like all others before it and those yet to come.
 
What say you Agents?



Is the Grave for Tesla Already Dug?

About the Author

Agent00J

User Comments

fiftysix
MDarringer
SanJoseDriver
TheSteve
SanJoseDriver
MDarringer
Agent00J
SanJoseDriver
skytop
MDarringer
Goshn
Goshn
ColMosby
Goshn
TomM
MDarringer
SanJoseDriver
SanJoseDriver
TomM
TomM
SanJoseDriver
Goshn
vdiv
TomM
MDarringer
SanJoseDriver

Add your Comments

Images hosted in your AgentSpace can now be posted in the comments section using the following syntax (case matters): [img]IMAGE URL[/img]
Example: [img]http://agent001.myautospies.com/images/sample.jpg[/img]