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Why the Saturn deal fell through
The Saturn of Colma sales lot in Colma, Calif. is closed. General Motors announced it will be phasing out its Saturn brand.
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TEXT OF INTERVIEW
Steve Chiotakis: Saturn is about to go the way of Oldsmobile and Pontiac. General Motors is getting rid of the brand after a deal to sell it fell through. Marketplace's Alisa Roth covers Detroit and she's with us live this morning. Hi, Alisa.
Alisa Roth: Good morning.
Chiotakis: GM had already said that it was gonna have to get rid of Saturn, then Roger Penske, the former car driver steps in and says he's gonna buy it. What was the plan?
Roth: It was actually a pretty clever idea. Penske was gonna create a virtual car company. He'd buy up the 350 Saturn dealerships -- and he already owns a big chain of car dealers, so that's not new territory for him -- and then he'd find a car maker to supply him with vehicles.
Chiotakis: And what happened? Why didn't this work?
Roth: Penske just couldn't find a partner. He'd been talking to the French company Renault, but this week Renault's board actually rejected the plan. I talked to Eric Merkle, a car analyst, this morning, and he says Renault's backing out is what did the plan in for Penske:
Eric Merkle: It's pretty much a lost cause. There's really not much he can do with that company without automobiles.
Chiotakis: And Alisa, nobody else was interested in this?
Roth: There were other companies, supposedly a couple of Chinese car makers said they wanted to talk, and some others, too. But Merkle told me that ultimately, Penske probably just thought anything but Renault was too risky.
Merkle: He didn't feel that any kind of an arrangement like that was solid enough to go forward with the deal.
Chiotakis: So now what?
Roth: GM closes Saturn, 13,000 jobs are lost, Saturn's 350 dealers get closed down. There are rumors here and there that Penske'll look for another supplier, but I don't think it's gonna happen.
Chiotakis: All right. Marketplace's Alisa Roth joining us this morning. Alisa, thanks.
Roth: You're welcome.
Yes, it is sad for the way business in America has turned. It still amazes me at how stock holders are convinced investing their money in a communist country is a good deal. Oh well,, we have a lot of great engineers, mechanics, electronics people, etc. We have many creative people in this country, we will survive. If we just just find a way to export the politicians jobs, we could save a lot of money. Write your congress people using pink paper with the words "You are fired!! Thanks good luck to all.
my saturn wishlist in no particular order:
0) saturn employee buyout of factories for saturn vehicle supply; penske dealership purchase for saturn vehicle distribution.
1)tesla/penske/saturn partership
short term: penkse dealership purchase; penske continues to service existing saturn fleet.
long term: as saturn fleet ages the tesla vehicle supply ramps up and decreases in price
then saturn owners would transition into teslas purchased at their penske saturn dealership as their saturn vehicles failed over the coming decade.
We had a early saturn(96) and it was fantastic (until a suburvan climb on top of it!). Then like all GM products it went south. I was going to buy another but told by other owners that it was another GM piece of junk. So I go a used Japanese car. Best thing I did! We should have saved tax payer money closed GM. Old school will never learn. Still wants V8s when the public does not! Except south of the border. perhaps mexico should extend the next bail out. they love chevy!
It's a shame - we've had two Saturns (own a VUE now) and both were incredibly reliable, easy-to-maintain cars. Not to mention a great value. I just hope that there is a similarly well-engineered, value-priced solid car made by a company in the near future!
This is a real shame. In the 1990's Saturn was a "model company" for its outstanding managment. Unfortunately, once it was reabsorbed into the GM brand, the company lost its independence, and now it lost its life. As a loyal Saturn customer since 1996, I'm sad to see it go.
