REPORT: GM asks Saturn dealers to hang on for 60 days
Thank you for calling the General Motors emergency hotline, please hold while we sort out what the heck to do with you...Saturn dealers are being asked by GM to hold on and not do anything drastic for 60 days while the automaker figures out its next move. There are several options possible, some more feasible than others. The one that's gotten the most attention recently is spinning off Saturn into an independent business, which has everyone intrigued. GM could even remain a supplier to Saturn if it cuts the right deal, as an independent Saturn would be purchasing products from other sources.
Some dealers think the brand could turn into a sort of automotive Costco, sourcing product from all over the place and putting the house brand on the grille. Perhaps the most likely scenario is GM steering its Saturn unit into bankruptcy, and hurrying the process along before the current product ages out in 2012. It's certainly a thorny little chestnut for GM to crack, and for now, Saturn dealers are being asked to refrain from doing anything like closing, or rolling another brand into their showrooms for at least 60 days.
[Source: Auto News - sub req]
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Reader Comments (Page 1 of 2)
TigerMil 10:07AM (2/24/2009)
Just kill it. GM has the process/business model down cold a'la Oldsmobile.
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Yikes 10:26AM (2/24/2009)
Hold on for 60 days.
Saturn has been "holding on" since their inception. Never made one dollar of profit for GM.
Tim 10:54AM (2/24/2009)
"Hold on"?
"Grab on to something immovable... like a Saturn Aura Hybrid on your lot." - Your GM management Team
g00fba11 1:26PM (2/24/2009)
@Tim ^
youucchhh!
ronEbear 10:22AM (2/24/2009)
The future of Saturn as a COSTCO type business:
Buy the all new Saturn Panda (most likely sourced from China) in the handy 4-pack family bundle and get the 5th one for free!
All new Saturn Pico (sourced from Tata Nano): Now 50% off!
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Demonblade 10:22AM (2/24/2009)
I hate to say it, as I am currently impressed with Saturn's resurgence and style, but GM should drop the brand. The General is spread waaay to thin, and he's gotta consolidate to survive this crunch.
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Eric77TA 10:23AM (2/24/2009)
I'm sure that GM would love to just kill it, but shutting down Oldsmobile cost more than a Billion dollars and took years. The death of a division isn't a gunshot, it's a poisoning.
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Yikes 10:27AM (2/24/2009)
I'm sure Saturn has lost way more than a Billion dollars for GM.
Jared 10:27AM (2/24/2009)
Apparently Saturn's contracts with its dealers are different and it would not be as costly to close as the other divisions. Also, there are relatively few Saturn dealers (only 400) compared to other divisions (e.g., Pontiac has 2000+ dealers).
The other Bob 2:16PM (2/24/2009)
That is why a bankruptcy of just Saturn, like Saab just did may get GM out from under its dealer obligations.
Jj 10:25AM (2/24/2009)
I am puzzled by this preference to "spin off" Saturn rather than sell the name and dealer network for some cash.
Regardless of your opinion of Saturn's product, they have a top-rated dealer network that certainly has value. There has got to be several foreign manufacturers with an eye toward the US market that could be potential buyers.
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Jared 10:28AM (2/24/2009)
If there were such foreign manufacturers with readily available financing and cars ready for the US market, they would have already been in negotiations with GM. Given the lack of interest in Saturn, it is clear that no such manufacturers exist.
robert bell 11:15AM (2/24/2009)
while it sounds crazy at first, the COSTCO approach might work; First, GM would have to agree to provide Saturn with GM Europe product on some basis ala a private label just as Starbucks makes the house blend for COSTCO. This might enable GM to use some of it underutilized capacity here or in Europe.
Saturn could then source models in categories (e.g. minis and econo boxes) not produced by GM from China and India. And, finally, if any Euro brand (e.g. Fiat or Citroen) wanted to enter this market the Saturn dealers might serve as a ready made outlet.
So long as there is a world wild glut of production capacity someone is going to look to the U. S. market as an outlet. Might as well be an inplace dealer network vs. starting over.
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Sea Urchin 12:55PM (2/24/2009)
Why would GM do anything good for Saturn? Once they are separated Saturn in effect become a Honda or a Toyota...a competitor.
Just like GMAC stopped lending to GM after the sale, GM will stop dealing with Saturn after the sale.
But wait, there's a good thing in all of this, Saturn dealers will lose millions of their hard earned money, money they made by doing hones work, all the while GM management will get its millions
monkeykat2 10:26AM (2/24/2009)
Any one else here the "dun dun duuuuuuuun"?
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len simpson 10:41AM (2/24/2009)
Hindsight says Saturn principles should have been applied to GM as a whole instead of a new badge. Interesting the consumer loyalty it generated with that new consumer/product relationship until GM let it revert to same old song.
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Fazzster 10:47AM (2/24/2009)
I would hate to be a Saturn salesman right now...
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WC 10:51AM (2/24/2009)
Yikes said that Saturn never posted a profit and cost GM a billion. Yikes, who's fault do you think that is?
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Tim 10:57AM (2/24/2009)
Why Saturn Fell to Earth
"GM's 'Different Kind of Car Company' was a great marketing idea, but low margins and confused branding doomed the experiment"
http://www.businessweek.com/magazine/content/09_09/b4121025530123.htm?chan=magazine+channel_news
Yikes 2:47PM (2/24/2009)
I place the blame on the management of GM. GM management let the concept die without new products for years. Then the management let the UAW come in and corrupt the brand. Management converted the original Saturn into just another GM badge whored division.
Saturn no longer stands for anything it was created to represent.