Posted on 09/30/2009 1:53:31 PM PDT by Kieri
BLOOMFIELD HILLS, Mich. (WXYZ) - The Penske Automotive Group has announced that it has terminated talks with GM on acquiring the Saturn brand.
Penske says negotiations with GM regarding the future supply of vehicles caused the breakdown in talks. G
In a statement issued by General Motors, the company is very disappointed about Penske's decision. This will ultimately be the end for the Saturn brand as GM prepares to wind down production and dealership network.
STATEMENT FROM GENERAL MOTORS:
Today we learned that Penske Automotive Group (PAG) has decided to terminate discussions with General Motors to acquire Saturn. 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. PAG’s announcement explained that their decision was not based on interactions with GM or Saturn retailers; rather it was because of the inability to source new products beyond what it had asked GM to build on contract.
As a result of PAG’s decision, we will be winding down the Saturn brand and dealership network, in accordance with the wind-down agreements that Saturn dealers recently signed with GM. Pursuant to the terms of those agreements, the wind down process will be determined and communicated shortly.
Saturn customers and owners will continue to be able to purchase and have their vehicles serviced at Saturn retailers during this process. Once the wind down is complete, Saturn owners will still be able to have their vehicles serviced at other GM dealerships. We will be communicating with our customers very soon to explain the next steps in this process.
Today’s disappointing news comes at a time when we’d hoped for a successful launch of the Saturn brand into a new chapter. We will be working closely with our dealers to ensure Saturn customers are cared for as we transition them to other GM dealers in the months ahead. I’d also like to thank every GM employee and Saturn retailer who worked so hard to try to make this new beginning happen for Saturn.
STATEMENT FROM PENSKE AUTOMOTIVE:
Penske Automotive Group, Inc. (NYSE: PAG) n international automotive retailer, today announced that it has terminated its discussions with General Motors Company ("GM") to acquire the Saturn brand, citing concerns directly related to the future supply of vehicles beyond the supply period it had negotiated with GM.
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. The company had negotiated a definitive agreement with GM to source vehicles on a contract-manufactured basis for a period of time. After this period, the company would have been required to source vehicles from another third party under a similar contract-manufacturing agreement.
Penske Automotive Group negotiated the terms and conditions of an agreement with another manufacturer; however, that agreement was rejected by that manufacturer's board of directors. 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.
AND Michigan's government is about to shut down. Again. Second time in three years.
I can remember going to that plant as a part of a “quality” study we were doing ... trying to emulate how well they did things. I can remember sitting in on some meetings and watching the process ... it was amazing. And now this ... how can something so exciting and efficient finally just fall off the table. Breaks my heart ... makes me wonder if that is the pattern for America today.
“You’re not Penske Material”
Wouldn’t want to be in Spring Hill, TN today...
As the owner and in effect Chairman of the Board, this is Obama’s fault.
buh bye Saturn
Robert Gibbs: "That's above the president's pay grade."
GM destroyed it’s other lineups providing financing for Saturn. It deliberately under-priced the vehicles, making it impossible for other GM brands to compete. It demanded huge land/building investments from would-be Saturn dealers. And now it is OB. Anybody still wonder how GM could go broke?? I dealt with these people as a Buick dealer for years and could write a friggin’ book about arrogance, stupidity, childishness etc.
As a previous Saturn owner, I’m not at all saddened.
But I was never a fan of the product or the business plan
.
How is that government run GM auto manufacturing joke working out for you?
If American auto manufacturers had just listened to Deming in the first place, they would have been the front-runners. Instead, we had to learn the same lessons secondhand from our Japanese competitors, to the degree they were learned at all.
Wonder why they are saying this deal is with General Motors? I thought it was now gov motors.
Sorry to hear that. Our 2007 Ion runs just great.
I guess the GM subsidization of Saturn was the reason the other manufacturer (mentioned in quote from article below) refused to sign the supply agreement. They couldn't deliver at the GM price without GM subsidies.
"Penske said it had negotiated an agreement to source vehicles from another manufacturer, but the deal was rejected by the other automaker's board of directors."
Surprising that the Penske/Saturn deal makers and accountants didn't pick up on this deal buster sooner.
I suspect that the UAW is a major reason for his decision. Unfortunately, everything that a union touches eventually dies unless some rat politician intervenes.
“I suspect that the UAW is a major reason for his decision.”
Gee, I would have thought it might be bad management by GM.
— Uninspired products, using a lot of rebadging.
— Mid pack quality.
— Bad management decisions, over and over. Aztek, kill off the Camaro/Firebird with no replacements, etc.
His book "Out of the Crisis" has some tips on health care, but nobody even bothered to use his ideas until one hospital went to Toyota two years ago. By the way JM Juran did some nice work over in Japan too and his work is under used in America. Wonder why?
I do not doubt that GM management has made many mistakes. The biggest mistake was not confronting the UAW a long time ago. In any discussion of the auto industry, the UAW must be at the center of problems. How would you manage a company stifled with 2,000 pages of union contract details designed to reduce productivity? How would you manage a company with crushing retirement and medical costs? These costs were externally pushed on the auto industry by the UAW labor cartel, government agencies, and rat politicians. I would manage the company by moving it to places not touched by the UAW.
“The biggest mistake was not confronting the UAW a long time ago.”
I agree. That was the biggest mistake management made.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.