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Penske Seeking to Buy Saturn
5 June 2009
General Motors Corp. and Penske Automotive Group confirmed details of a proposed transaction under which Penske would acquire the Saturn brand. If completed, the deal would save more than 350 dealerships and 13,000 jobs at Saturn and its retailers in the United States, and would preserve the Saturn brand.
The proposed transaction is part of GM’s rebuilding efforts outlined in the viability plan that was submitted to the US government earlier this year. (Earlier post.) Under the terms in the memorandum of understanding, Penske would obtain the rights to the brand as well as certain other Saturn assets. GM would continue production, on a contract basis, of the Saturn Aura, Vue and Outlook.
The transaction is expected to close in the third quarter of this year and is subject to customary closing conditions and regulatory approvals. Financial terms of the agreement will not be disclosed at this time.
Saturn began selling cars in 1990 and has sold more than 4 million vehicles. More than 80% of those vehicles are still in operation, according to data from R.L. Polk.
Penske Automotive Group, which sells new and previously owned vehicles, finance and insurance products and replacement parts, and offers maintenance and repair services on all brands it represents, has 158 franchises in 19 states and Puerto Rico and 152 franchises located outside the United States, primarily in the United Kingdom. Penske Automotive is also the exclusive distributor of the smart fortwo through its wholly-owned subsidiary smart USA Distributor LLC.
June 5, 2009 in Brief | Permalink | Comments (10) | TrackBack (0)
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This is going to be interesting because GM is going to be a supplier/contractor for once after decades of having suppliers and contractors under its thumb... Penske will no doubt drop GM in a heartbeat if it is supplied with crappy cars.
Posted by: ejj | June 05, 2009 at 05:52 PM
Penske will pay between $100 and $200 M and expects to maintain Saturn's 350 dealerships and parts warehouse/distribution center but the assembly plants are not part of the deal.
Saturn's auto-manufacturing jobs would be retained "for the near term” but Penske is looking for a "worldwide partner" to manufacture Saturn vehicles.
http://washingtontimes.com/news/2009/jun/06/penske-to-buy-saturn/
Now that the evil management is to be replaced, why doesn't Penske keep the assembly plants with the UAW and workers?
He would have a winning team.
– Just kidding.
By the way, who will pay the UAW workers for not working ?
Let me just look in this mirror. . .
Posted by: ToppaTom | June 05, 2009 at 09:02 PM
It is convenient and perhaps perversely self satisfying to blame the UAW for everything that is wrong. In Germany, they have a MUCH stronger union than the UAW in their auto plants. They pay them well, train them well and provide good benefits and they do not sit around blaming them for everything, because they build the product, just like the UAW does.
Posted by: SJC | June 05, 2009 at 10:23 PM
When they cripple one of the Detroit 3 at a time to negotiate a contract
and obstruct innovation and automation that might reduce labor costs
and require the company to pay workers that sit around idle
and require ALL workers to pay union dues
they just might get blamed for it all.
German union workers probably have a work ethic.
To their credit the UAW is agreeing to work for less for their bosses at the new GM.
The self employed are less inclined to "stick it to the man".
Posted by: ToppaTom | June 06, 2009 at 12:41 AM
Toppa,
Thirty yrs ago the UAW was a destructive entity. No argument there. However, blaming them for what has happened in the past 20 yrs is bogus. The quality of UAW built cars matches the worlds best now.
The blame for current failures falls upon management. This includes not standing up to the UAW more. The UAW has a right to fight for whatever they can get. It's the job of mgt to counter that.
And, mgt made all the bad decisions to keep building SUV's and bloat mobiles, and to fight higher milage sttandards. The UAW was not involved.
Not to mention Chrysler's disasterous merger with Daimler. That was all mgt.
Posted by: danm | June 06, 2009 at 08:06 AM
The unions just want a decent wage which preserves a middle class. When the average worker (anyone that receives a paycheck is in that category) just wants to pay the bills, put their kids through school and have a retirement, but can not because of downsizing and outsourcing for decades, you have a problem even affording Wal-Mart. This was not the right direction to go and I think that we all know this.
Posted by: SJC | June 06, 2009 at 10:16 AM
Years ago the UAW was the underdog, trying to get decent wages for workers in a powerful auto industry. But now they are the oppressors.
Each year we hear that the quality of UAW built cars matches the worlds best; but of course we have heard that each year. I think they are much better now but the labor cost is a killer.
The management is legally prevented from standing up to the UAW.
They cannot replace the workers – what if you were a taxi driver and could only buy from one station – of course when he charged you $8/g it would be OK - the operator has a right to fight for whatever he can get – he just wants to pay the bills, put their kids through school and have a retirement.
Umm, wait maybe $8.50/G sounds good – to HIM, and he decides.
Mgt made all the good business decisions to keep building SUV's and bloat mobiles, and to fight higher mileage standards (which the UAW supported) to keep from being forced into making small cars, which would be a massive loss of profit.
Management is responsible for good BUSINESS decisions – like making light duty trucks (47% of the US market) and SUVs & cross-overs (27% of the US market) (source; WSJ).
Small cars are less than 20% of the market -
and Asia, with their Asian and non-union transplant labor costs are untouchable.
What bad decisions? Decisions you don’t like?
Posted by: ToppaTom | June 06, 2009 at 01:52 PM
Quoth SJC:
You forgot "accurate". I have heard ex-UAW workers talk about sabotaging the productivity of their parts of the production system. With pride! And a large fraction of them are (were) functionally illiterate.The Big 3 found they could get cheaper functional illiterates in Mexico, and German workers have both a work ethic and the ability to read and understand instructions. The UAW stuck Detroit with the worst of both worlds, and we are seeing the end stages of the resulting disease.
Quoth danm:
The UAW had a monopoly on labor for the entire domestic industry, and was able to force issues like retiree health care off the table. No one manufacturer could deal with this, as being struck could force it out of business or at least into a severe disadvantage. The only solution to this was bankruptcy, which is where we are now.Posted by: Engineer-Poet | June 07, 2009 at 04:42 PM
EP,
You disappoint me. I thought you were more intelligent than that.
Posted by: SJC | June 07, 2009 at 07:49 PM
You mean, you didn't think I know the situation first-hand.
Posted by: Engineer-Poet | June 07, 2009 at 08:21 PM