Penske Saturn Deal Falls Apart: GM To Shut Down Brand

DETROIT — General Motors Co. said Wednesday it would shut down its Saturn brand after an agreement with Penske Automotive Group Inc. to acquire it fell apart.

Penske, citing concerns of whether it could continue to supply vehicles after a manufacturing contract with GM ran out, ended talks with GM Wednesday to acquire the brand.

GM CEO Fritz Henderson said in statement that Saturn and its dealership network will be phased out.

"This is very disappointing news and comes after months of hard work by hundreds of dedicated employees and Saturn retailers who tried to make the new Saturn a reality," Henderson said in a written statement. "PAG's announcement explained that their decision was not based on interactions with GM or Saturn retailers."

In a statement, the Bloomfield Hills, Mich.-based auto retailer says an agreement with another manufacturer to continue producing Saturn vehicles after GM stopped making them fell through, leading Penske to terminate talks with GM.

Penske said it negotiated terms and conditions to make Saturn cars with another manufacturer, but that company's board of directors rejected the agreement. Penske spokesman Anthony Pordon would not identify the other manufacturer.

"Without that agreement, the company has determined that the risks and uncertainties related to the availability of future products prohibit the company from moving forward with this transaction," the company said in a statement.

In June, GM and Penske agreed to take over the Saturn brand and related dealerships, although GM would produce the vehicles for a limited period of time.

GM said Saturn vehicle owners can still go to their Saturn dealer for service and would be able to go to a certified GM dealer for service once Saturn dealerships are closed.

It was expected that GM would announce the completion of Saturn's sale to Penske in the coming days.

Share of Penske fell $1.93 to $17.25 in after hours trading. They rose $1.32, or 7.4 percent to $19.18 in regular trading Wednesday.

Comments

[Playin Possum]

So the last two brands GM created are gone - one destroyed and one sold to the chicoms. Globalism is destroying America.

[Gernuser]

To make matters far worse, consider what the US government has actually done to fix the underlying problems? Nothing

good articles; http://iamned.blogspot.com

The government has put the same punch bowl out that got us into the mess in the first place. More debt and consumption and don't worry about paying it back. (Berbnanke= Greenspan II)

[chasworth]

Today a foreign auto manufacturer who was to supply future model cars to Saturn backed out of the deal to Penske because they would not commit to supplying cars two years hence based on present day commitments for the future value of the dollar. Clearly they recognize that the dollar is being devalued and unstable because of the reckless spending of the Democrats. What they are doing to the economy now is clearly affecting the chances of a sustained recovery. Adding an expensive issue like Health Care to the economy without true reform will be the straw that breaks the camels back. The country won't survive another downturn and the fools in Washington who are gambling with our future because they are trying to play politics (and hang onto their support) should be recalled for abuse of reckless power.

[watchTVgetSTUPID]

I will tell you what happened to Saturn. Czars are corrupt insiders who have nefarious agendas. Look at Rattner the car czar known as the NYC DNC's ATM machine. Rattner is a Wall Street Gordon Gekko who forced GM to abandon millions of loyal Saturn customers. GM's CEO Waggoner tried to save the company and jobs but Obama's car czar Rattner would not have any of it and forced Waggoner out in a corporate coup. Then Rattner replaced GM's board of Directors with his own followers. Rattner's outsiders now controled GM and announced GM would eliminate Saturn, Pontiac, and 2,000 dealerships. Millions of loyal customers who have been stabbed in the back by Obama's car czar will now buy foreign imports. I voted for Obama and I am disappointed.

OBAMA HAS BECOME THE DESTROYER OF AMERICAN JOBS

[mcmutter]

Saturn dealers can go to he// where they deserve to be.

[rollingdivision]

MICKEY KAUS: Rattner’s Legacy: The Chooch Is At The Door. “GM’s sales are down 45% from last September (when sales were already bad enough to drive the company into bankruptcy). Chrysler is down 42%. Ford is only down 5%. Car buyers are clearly punishing the two bailout recipients brutally. Robert Farago of Truth About Cars predicts that GM and Chrysler will both ‘go down by the end of next year’ without a second, new federal bailout. The only question, he says, is whether the two bailed out manufacturers will need the cash before the 2010 midterm elections.”

[rpahk]

There could have been an alliance between Opel and Saturn if GM had gotten creative: use Opel's design and manufacturing and Saturn's dealer network. Or even Fiat as Fiat would have been farther ahead with Saturn than the legacy problems they bought into at Chrysler. Saturn has/had a great dealer network just begging for some decent product to sell. Too bad the Chinese are not there yet with cars that can compete in the world market.....

[watchTVgetSTUPID]

Saturn is heavily an Opel design. Yes there is a lot that could have been done but Obama appointed Rattner as car czar and Rattner only knows Wall Street corporate manipulation (not auto manufacturing). Rattner forced GM to abandon Saturn, Pontiac, Opel, and 2000 dealerships. This destroys Pontiac and Saturn sales (nobody wants to buy a car that is being phased out). The smaller sized GM will not have the economy of scale as before and will wither away over time.

[ejhickey]

The Federal Government owns at 60% of GM. Any questions about why GM is closing down Saturn should be directed to the majority stockholder and the Car Czar.

[royevatom]

This Is where Capitalism fails and the repercussions at this point should be obvious.

[Forreal567]

Saturn failed because they didn't sell enough cars to cut the mustard.

[ensilager]

In my opinion, Saturn failed due to design flaws and extremely expensive repair bills. Ask any unfortunate soul who had the horn stick open on a 2002 Vue that was no longer under warranty. Google Saturn Vue 2002-2003, and you will see that the number of problems with these vehicles is ridiculous. A class action suit was brought against Saturn for its POS transmissions, just as ONE example. I learned more online than my dealership knew about my 2002 POS Vue. No more Saturns--I ain't cryin.

[ILibertine]

Now here is where TARP money should be going - toward a small business consortium of employees and managers who could revive the brand and keep jobs and production here. This would be using taxpayer money for something that is actually produced, rather than manipulated, and could contain conditions about fuel economy standards as a federally aided experiment plant for increasing efficiency and developing alternative fuels, with level-field labor contracts.

[Sandiaman]

The Saturn manufacturing jobs left a long time ago. The drive train of the 04-07 6cyl VUE was by Honda. The newer VUE was/is made in Mexico. The Astra is made in Belgium. The AURA and OUTLOOK are GM clones.

[JScott]

Kinda sad really, the Aura was a pretty good car, but then again GM wants to spinoff Opel as well.
Too bad it didn't go thru, I'll bet there would have been some interesting cars brought to these shores
if the Penske deal went thru.

[AlGoreIsMyPresident]

I have a 1984 Volvo 240 with almost 300,000 miles on the original engine and transmission. I respect things that are built to last.

[Itsmyland2]

Go to any Saturn dealer and see the wall of photos from the 200K club. They are built to last. Only American car I would buy. They are killing their best division

[Itsmyland2]

Go to any Saturn dealer and see the wall of photos from the 200K club. They are built to last. Only American car I would buy. They are closing their best division

[Itsmyland2]

I don't understand why GM would drop Saturn and continue to make big gaudy gass guzzling Cadillacs. This makes no sense. Saturn's are fuel efficient, reliable and affordable. Why would we want that?

[jteamaz]

Americans love their status symbols. A Saturn won't turn the heads and get you noticed like a Cadillac. And, god forbid we save a bit of fuel. Gotta keep the oversized gas guzzlers ya know....

[Elyriaohio]

It always seemed like Saturn was just a big experiment with no real support from G.M.
They were like the red-headed stepchild of G.M., while G.M. kept their old bloated business plan.
Pontiac should have been buried, and Buick/Oldsmobile consolidated years ago.

[Ping]

Anyone watching CNBC and the Bernanke hearings should see the biggest problem in this country is the corruption of our politicians. These Congressmen on both sides are clearly running interference for the banks. The only person in that room who represents the interests of the taxpayer is Ben Bernanke..­.....unbel­ievable.

[Ping]

Wrong thread sorry.

[watchTVgetSTUPID]

Bernanke is protecting his crooked Bankster friends and is ruining America in the process.

[Ping]

You should watch TV. The Congressional hearings with Bernanke, then you would know who has the bankster friends