Report : Penske walks away from Saturn deal, and GM forced to kill Saturn brand !

No matter how ready you are expected to hear bad news, it'll always be a shock. Back last summer, when General Motors was crying for some extra cash, it was reported that their Saturn barnd will be sold to Penske Automotive Group. While that was certainly good news, Penske and GM went through a lot of discussion sessions about the supply, maintinance, and labor.

Well after months of discussion, Penske announced that it's mostly worried on future supply of vehicles, and therefore their negotiations with GM about the purchase of Saturn have been canceled. “Since announcing its discussions with GM on June 5, 2009, the company has been in the due diligence process to determine the feasibility of developing an independent distribution model for Saturn-branded products and service parts in the United States, including the sourcing of vehicles from GM and other potential suppliers,” Penske said in a statement. “The company had negotiated a definitive agreement with GM to source vehicles on a contract-manufactured basis for a period of time.”

On GM's side, CEO Fritz Henderson announced that the Saturn brand will be "winding down" the brand, until Saturn finds a new owner. “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,” GM CEO Fritz Henderson said in a statement. However, Henderson also stated that customers can still buy Saturn vehicles in dealers, and owners can still have their vehicles serviced. GM is determinded that no jobs will be lost, even after the death of Saturn.

Source : [Penske Automotive Group, General Motors]

BREAKING : GM agrees to sell Saturn to Penske Automotive Group

With the Chapter 11 bankruptcy looming on General Motors, GM are cutting costs as much as possible. Well, first as GM sold Hummer to China's Sichuan Tengzhong for Heavy Industrial Machinery, GM also intended to sell Saturn. Well, earlier reports that 16 companies were interested for the purchase of Saturn. Saturn is the GM brand that ships Opel vehicles to the States.

It is officially reported that General Motors has reached an agreement to sell Saturn to U.S.-based Penske Automotive Group. The source said that Penske will pay $100 million to $200 million for Saturn, winning the bid over the other 16 companies. Penske are known as the second-largest retailer in the States.

Like the Hummer deal, Saturn's new owner plans to keep Saturn's same factory plants and dealerships, which will help save more than 350 dealerships and 13,000 jobs at 'New Saturn'. Penske also announced that Saturn's Aura sedan, Vue SUV and Outlook SUV are kept into production, but the Astra and Sky are 'dead'.

Source: [The New York Times and Bloomberg]

Bob Lutz: Despite the good lineup, Saturn may not survive

Bob Lutz, who recently announced that he will retire by year end, said that GM’s struggling Saturn brand probably won’t survive. He said his personal favorite would be to see Saturn survive and prosper but believes that the ”reality is that that is probably not going to be the outcome.” So in other words, Saturn days are countable and reaching to the near end.

In an interview with Automotive News, Lutz said: “We spent a huge bundle of money in giving Saturn an absolutely no-excuses product lineup, top to bottom. They had a better and fresher lineup than any GM division, and the sales just never materialized. So we have to act on that. It’s our duty.”

GM has yet to confirm what it plans on doing with Saturn, Hummer and Saab.

Saturn’s sales fell about 22 percent in 2008 to a total of 188,004 units sold. GM hoped to sell about 100,000 units of the Aura sedan which was named 2006 North American Car of the Year. However the car has yet to come close to the target. 2008 sales for the Aura totaled 59,380.

Source: [Automotive News]