DETROIT (Oct. 1, 2009)—General Motors Corp. said it will begin phasing out its Saturn unit, the car company conceived more than 25 years ago to fend off imports, after bidder Penske Automotive Inc. failed to secure a source of vehicles to keep the brand afloat.
Penske had been negotiating with France's Renault S.A. to acquire autos for Saturn once a production agreement with GM had expired. Those talks collapsed, scuttling the Saturn acquisition by the Penske dealership group and its CEO, Roger Penske.
“Mr. Penske is clearly a very clever man,” said Paul Melville, a partner at Grant Thornton corporate advisory and restructuring services. “If he has pursued a deal with Renault and if it's too difficult to make that happen, it's dead.”
Renault acknowledged it had been in talks with Penske to supply cars, parts and technology for Saturn, but a deal couldn't be reached. The collapsed deal puts Saturn in the same camp as Pontiac—brands that GM plans to phase out over the next 13 months.
GM also is in the process of selling a controlling stake in its European Opel unit as well as Saab and Hummer. As part of its U.S.-steered bailout and bankruptcy reorganization, the auto maker will focus on Buick, GMC, Cadillac and Chevrolet.