SATURN, the subsidiary created by General Motors to compete with Japanese manufacturers in the North American small-car market, will break even on an operating basis this year, three years after selling its first vehicle, the company said yesterday.
While Saturn has not begun to recover the dollars 3.5bn GM spent establishing the new division, the company should begin turning a profit in 1994, the president, Robert LeFauve, told reporters at the North American International Automotive Show in Detroit.
Saturn sold 196,000 cars in 1992 at an average price of dollars 13,000. The division has announced plans to add a third assembly line at its factory in Tennessee this year.
The expansion will increase its capacity to 300,000 vehicles from 240,000 a year. 'Our costs continue to come down as we increase our volume and reduce the size of the organisation,' Mr LeFauve said.
While there continues to be a six-week waiting list for some Saturn models, dealers now have an average 20-day supply in their showrooms.
Many industry analysts had been sceptical of Saturn's prospects when the project was first unveiled in the mid-1980s.
While the company never released projections for when it would cover its costs, a spokesman said yesterday that Saturn's performance 'is close to schedule'.Reuse content