GM Reaches Prelminary Deal to Sell Saturn to Penske

By Chris Haak


saturn-logo-smallMoving quickly to shed itself of parts of the so-called “Old GM,” GM has agreed to a preliminary deal to sell its Saturn business to Penske, according to anonymous “people familiar with the matter,” as reported in this morning’s Wall Street Journal.  While the deal is not a surprise for folks who follow the auto industry, it’s also good news for many people who work at Saturn dealers who were facing an uncertain future.

Under the terms of the preliminary agreement, Penske Automotive Group, one of the nation’s largest auto dealer chains, will take ownership of the trademarks, brands, service and parts operations, and distribution operations related to Saturn. Also, Penske Automotive Group is seeking deals with several automakers, including GM and Renault SA, that would allow Penske to fill out Saturn’s lineup in coming years with vehicles from those automakers.

Penske Automotive Group is, of course, basically the US distribution arm for Daimler AG’s one-vehicle smart brand, and according to the previously-linked Autosavant article, Penske apparently only needs about two-thirds of Saturn’s current 384 dealers.  So, not all good news for Saturn dealers, but two-thirds surviving (if the rumor is true) beats none surviving had the brand not been sold and been simply shuttered by the Old GM.  The sale price was not disclosed by the people familiar with the matter.

I’m still not convinced that this is a viable strategy going forward – while Saturn’s dealers are certainly its best asset, the idea of other automakers allowing Saturn to choose the best vehicles out there to fill out its lineup rings (to me) like almost an unrealistic premise.  Why would Honda or Mazda, for example, allow Saturn to rebadge the Civic and Mazda3 as a Saturn “Astra,” for example?

By looking at least partially outside of North America as a vehicle source (perhaps completely; I’m not privy to Penske’s negotiations with automaker partners, obviously), Saturn does alleviate some of the rebadging concerns that automakers who also sell in North America might have.  Few in North America have heard of Renault Samsung, and even fewer could recognize a Saturn-badged Renault Samsung product as what it really is.  Many of Nissan’s passenger cars are well-engineered and well-regarded, and many of them share platforms with Renault and Renault Samsung products, so that might be a boost to Saturn’s product credibility.  Some of the styling of the Korean-sold Renault Samsung models that I’ve seen appeared to be a bit overstyled, but most of that overstyling and excessive chrome could be removed easily enough when restyling and federalizing the cars to meet US tastes and safety standards, respectively.

GM clearly didn’t have enough resources to properly support all of its brands, as Saturn’s launch-then-forget marketing campaign for many of its generally very good models has proven (the Aura’s marketing budget went to feed the Malibu’s launch, leaving the Aura to sit on dealers’ lots, for instance), so the sale to Penske Automotive Group – an organization that clearly knows a lot about selling cars and consumer taste – may be the best alternative for the Saturn brand.  It will be interesting to see how this shakes out in the coming months and years.

Update 12:00 noon:  GM has issued a press release on the proposed sale of Saturn, and noted that more than 350 dealerships would be preserved, so that seems to indicate that Penske will in fact be using all Saturn dealers, not just 250 as had been previously rumored.  Penske Automotive Group also issued its own press release that indicated that GM would continue to provide it with the Aura, Outlook, and Vue on a contract basis for an interim period.

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Author: Chris Haak

Chris is Autosavant's Managing Editor. He has a lifelong love of everything automotive, having grown up as the son of a car dealer. A married father of two sons, Chris is also in the process of indoctrinating them into the world of cars and trucks.

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  1. Combining the current Saturn “no haggle” policy, and rebadged viehicles is a sure recipe for distaster. Every time I’ve been in a Saturn dealership it was to get a quote that I then took to another dealer and said “beat this price on your equivelent model”.

    Since the no haggle policy is generally what consumers actually like about Saturn, it’s probably not a good idea to drop it, which means they really need cars that are different than those already on the US market.

    Cars from GM’s Opel division would be a pretty good start. (properly fereralized of course)

  2. Even money that Saturn will soon be paire with Smart car dealers AND will be selling Renaults, Holdens, Nanos, etc.

    All the cars you can’t buy in the States.

  3. This is a coup for Penske, which has a history of stability and profitability in many facets of the auto industry. Look for them to extend the reach of the Penske truck and Smart brands while consolidating facilities through the Saturn dealer network, taking advantage of lower operating costs in the process.

    For GM, it’s quite a shame. That ugly step sister they just unloaded may well have been Cinderella, but that will only be clear when Prince Roger takes over.

  4. DP you might on to something, and there a rumor then GM might consider to sell Pontiac instead of killing it

    I suggest to Penske to step on Pontiac before the Chinese, Indians, Renault-Nissan, VW, BMW (DeLorean had wished then Pontiac became the “American BMW” and BMW could use Pontiac as a low-price entry), Toyota, Honda, Fiat (and by extension Chrysler who knows?) or even Ford might step on it.

  5. Look for some version of the Renault Logan to be sold at Saturn dealerships in the next couple of years.

    Economical, cheap, safe, comfortable.

  6. Ford doesn’t need or want Pontiac. Mercury used to be Ford’s “performance” marque, now it just sits there rotting.

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