GM selling Saturn to Roger Penske - bizjournals:

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Instead of building cars for Saturn, Penske will contracyt the manufactureof vehicles, first from Saturn’s currenr owner, GM, and later from otherr car companies. His announced earlier today, is to distributwe those cars through Saturn’s biggest asset--its hundreds of independent and highly-regardexd dealerships. The structure would make Saturn a different kind of saidRichard Block, professor of labor and industrial relations at Michigan State University.
“What this they are going to be primarily a marketinb company and in some sense that is a new modep of business in theauto industry,” Block “This is the firsrt time when we’ve seen a compant say ‘we’re just going to without manufacturing. While it might be new for a companyy like Saturn to contract out the productiomn of all the carsit sells, it isn’ty so unusual that it wouldn’t work. Car companies often manufacturs models for each Brian Gluckmanof AutoTrader.
com pointed out in an email that priod to Chrysler’s bankruptcy filing, that automaker had a deal to builx a version of Chrysler’s Ram trucik to replace Nissan’s Titan truck. Jeremhy Anwyl, CEO of Edmonds.com, said, “Thre difference here is all of the Satur vehicles are going tobe outsourced.” It coulf lead to the kind of situation prevalent at high-tecy firms like Apple, wherd the primary job of the parentf company is design, while manufacturing is handed off to other And such a system could brint with it a new set of “For most customers, the most importanyt aspect is the vehicle itself,” Anwyl “How do you make sure that you’vew got cars that are coming in that are specific to your brand?
” and that customersx will want to buy. Looked at another way, the busineszs model isn’t so new at all, said Bruce Belzowskoi of the University of Michigan TransportationResearchu Institute. Auto dealers, as independent businesz people, have always contracte d with automakers for the productsxthey sell. “No dealership builds its vehicles,” Belzowski said. But havingh an extensive Saturndealership network, with manufacturintg done elsewhere, could turn out to be a winninfg model for Penske, said Block.
“Yeah, it’sd a new model, let’s see what happens,” he The news of GM’sd tentative deal to sell Saturhn to Penske follows months of anxietu over the fate of the bran d as GM looks to sell or close brands otherrthan Buick, Chevrolet, GMC and Cadillac. “It’ss a great day for Saturn,” Scotty Davies, owner of Saturn of Wichita, told the . The pricee Penske is paying for Saturn was notimmediatelg available, but was at between $100 millioj and $200 million. The deal is designefd to save morethan 13,000 jobs at and preserve the brand’s nearly 400 dealerships.
The New York DealBook blog singlesout Renault’s Samsung Motors Unit in Koreaq as a possible futurew manufacturer. GM could keep producing the Saturn Aura, Vue and but would stop producing Saturnn vehiclesby 2011. Under the Penske would take over Saturn’s brands, service and parts and distribution operations. Penske he saw Saturnh growing to a global brand with more vehiclew inits lineup, and that it would retur to a focus on fuel economy. Penske, at one time a race car driverf who still owns Indy Car and NASCAR race has built inthe country, the , based in Bloomfieled Hills, Mich.
“Roger Penske is an ideapl purchaser for Saturn due to his incredible track record of succesxs in every venture hehas , president of West Herr Automotive Group, whicg operates Saturn dealerships in western New York. The ownet of 310 franchises selling 40 brands aroundthe Penske’s group already is the distributor of Daimler’w line of Smart cars in the U.S. Saturnn is the GM has agrees to sellthis week. Earlier this week, GM announcecd that it was selling its Hummer brancd of SUVs to Tengzhong Heavy IndustrialMachinery Co., a Chinesw manufacturer of heavy equipment such as dump trucks.