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Saab Turns Over 3 Area Franchises to One Dealer

April 01, 1998|JOHN O'DELL | TIMES STAFF WRITER

Mirroring efforts by several major car makers to trim their retail networks, Saab Cars USA has acquired the last of three Saab franchises that once served Orange County and Long Beach and turned over the entire territory to a single dealer.

Campbell Automotive Group in Santa Ana said Tuesday that it has been awarded the exclusive right to sell Saab automobiles in the region.

Saab acquired and closed its Long Beach dealership in 1996 and its Mission Viejo franchise last year. On Tuesday, it closed the doors at Tustin Saab.

Campbell will open the new Saab store on Thursday in temporary headquarters in Huntington Beach in order to take delivery of the 1999 models that Saab is introducing this month.

Saab is 50% owned by General Motors Corp., which is trying to impose its Saturn division retailing strategies on the ailing Swedish car maker. Campbell Automotive was one of the first California dealers for Saturn, which grants large, exclusive retail territories.

Dealership consolidation is a retailing tool that GM is trying in Georgia and New Jersey. Nissan Motor Corp. USA is experimenting with it in San Diego, and Ford Motor Co. is trying it in the San Fernando Valley.

Manufacturers view it as a way to slash distribution costs while improving the customer satisfaction that is critical to ongoing success in the fiercely competitive automobile market.

Reducing the number of dealerships a car maker has in one area "means those that remain have less pressure to push the customer immediately into a negotiate-and-buy situation," said Daniel A. Gorrell, vice president of market research firm Strategic Visions Inc. in San Diego.

That is Saab's intent, says John B.T. Campbell, whose company was asked by Saab to take on the territory covering Orange County and the Long Beach and Cerritos areas south of the 710 Freeway.

"The idea of a large territory is to let the dealer focus on competing with other brands rather than competing with other dealers selling the same cars," Campbell said.

It's no surprise that Saab is adopting the so-called Saturn model of exclusive territories for its dealers. Saab USA President Joel Manby is a former Saturn executive selected several years ago to head Saab's North American operations.

GM acquired its 50% stake in struggling Saab Automobile in 1990 and has since pumped more than $1.1 billion into the company.

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