SAN CARLOS, CALIF., DETROIT: Two car companies on opposite ends of the business spectrum and the continent are forging strategies to emerge whole.
Tesla Motors, the California company specializing in electric roadsters, opened a showroom in Chicago, the first of seven to be launched this year. Meanwhile, General Motors’ Saturn dealers have launched an ad campaign to assure car shoppers that the brand still exists. With Saturn, Saab, Hummer and Pontiac divisions in GM’s cost-cutting cross-hairs, dealership traffic has plummeted, The New York Times reports.
In one such ad, the owner of Saturn dealerships in Connecticut is quoted saying, “Let me tell you what’s going on with Saturn. We’re still here.”
The cost of the campaign is not mentioned, but Saturn’s ad spending across major platforms (TV, radio, print, online, outdoor) last year was $201 million, versus nearly $295 million in 2007, the article said.
While the automakers are traditionally the biggest buyers of national network time, it’s the dealers that support local stations the most. The entire auto industry injected more than $10 billion in the U.S. media market last year (all platforms), versus $11.9 billion in 2007, a drop of nearly 16 percent.
GM is survival mode, having swallowed more than $13 billion in federal funds and seeking another $17 billion. The company initially said it would shut down Saturn in 2011, but dealers requested a feasibility study. Automotive Newsreports that other manufacturers are circling, including foreign interests.
While the big car makers get small, Tesla is at least attempting to get big. The new Chicago location also represents its first footprint outside of California. The San Carlos concern has showrooms in Menlo Park and Los Angeles. Other cities on the slate include London, Manhattan, Miami, Seattle Washington, D.C. and Munich, Germany, although specific locations in those cities haven’t been nailed down.
Tesla, a five-year-old start-up backed by venture capital, first introduced a high-end, $109,000 roadster about a year ago. The company today announced delivery of its 250th car. A U.S.-based manufacturing facility planned for a less expensive production-model sedan awaits a loan guarantee from the federal government. Tesla is nonetheless going forward with its plan to produce the Model S, a $57,400 version of its car that, with a federal tax credit, is expected to run around $50,000.
A prototype is set to debut March 26. Retail availability is projected for 2011. -- Deborah D. McAdams
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