Transportation costs and small-car distribution patterns were key factors in General Motors Corp.'s choice of Tennessee as the prospective home for its Saturn Corp. auto manufacturing complex, GM officials said here today.
Tennessee's southeastern location puts the state within 500 miles -- one day's delivery time -- of 76 percent of the country's major markets and population centers. But it gives GM even closer proximity to its intended market for the Saturn subcompact car -- young urban professionals primarily living in the Northeast, Southeast and Southwest, GM officials said.
Even before the creation of Saturn Corp. was announced last Jan. 8, GM had staffs at work studying the geographical sales and distribution patterns of all GM cars and of all other cars competing in the small car segment of the U.S. auto market.
"We looked at the distribution pattern that we saw for Saturn versus all other small cars out there," said Stanley D. Hall, spokesman for Saturn Corp. "Most of the Japanese cars were selling on the West and East coasts. Cars like our [midsize Chevrolet] Celebrity were selling well in the Midwest."
GM's big rear-wheel drive machines, like the Chevrolet Caprice and some of the larger Cadillacs, also were selling well in the Midwest and in some parts of the Southwest and Northeast, GM officials said. They said that GM felt that it had already positioned a strong competitor on the West Coast with the importation of small engine Sprint subcompacts from its Japanese partner Suzuki.
Also, GM officials said that their joint venture with Toyota Motor Co. producing Nova passenger cars in Fremont, Calif., would add to their small-car strength on the West Coast as well as give them extra small-car muscle in certain parts of the central United States.
But the population of Saturn's target buyers has been moving from the northeast down to the middle-Atlantic states and to the Southeast and Southwest, GM officials said here today.
"I mean no offense at all to the Midwest when I say this, but we don't see this [Saturn] as a middle-America car. That's where we're selling the Celebrity and [Chevrolet] Cavalier," Hall said.
Said William E. Hoglund, president of Saturn Corp.: "There is a population shift out of the Northeast to the Southeast and Southwest that changes the distribution patterns and that moves the geographical center for shipping automobiles down to the Southwest."
Texans, whose state was long a top contender for the Saturn complex, had argued that the population shift cited by Hoglund was a major reason that their state should have won the intense Saturn bidding war.
Hoglund and other GM officials who were here today to formally announce Spring Hill, Tenn., as the Saturn site diplomatically sidestepped all questions about the 37 other states that competed against Tennessee for Saturn. The GM officials also refused to provide specific figures about product transportation costs out of the various states that were under consideration for the Saturn project.