General Motors seeking to shed Saturn

[barbarian]

(03-01) 04:00 PST Detroit --

The last hope to stop General Motors Corp.'s wounded Saturn brand from falling out of the solar system appears to rest with some unknown automaker building cars for the dealers to sell.

GM said in its restructuring plan presented to the U.S. government Tuesday that it will only keep Saturn running through 2011, but it's open to the possibility of spinning off the money-losing brand to retailers or investors. It's one of many tough steps the Detroit automaker says are necessary as it seeks a total of $30 billion to ride out the worst sales slump in 26 years.

Chinese and Indian automakers, which have made noise about entering the U.S. market, would be the most likely suppliers, but GM says it hasn't had any discussions with them, and Indian automakers either expressed no interest or wouldn't comment.

Saturn's dealers, with laid-back salesmen and no-haggle pricing, often match luxury brands' scores in independent customer satisfaction surveys. Their locations could be a ready retail network for a foreign automaker to come to the United States.

"The goal - from a product perspective - would be to find future vehicles that match the Saturn Brand: fuel-efficient, safe, reliable and affordable," Saturn General Manager Jill Lajdziak wrote in a message to customers this week. "From a retailing perspective, we would build on our core strength of unmatched customer service. The same hassle-free experience that is a hallmark of the brand could be taken to even higher levels."

Carl F. Galeana, who owns two Saturn dealerships in Michigan, said he would welcome a buyer from China or India, as it would keep the company going and bring innovation to the product line.

"It's very possible," he said. "It gives a footprint for an automaker to come into this country on the cheap and have a good distribution network."

But other dealers are angry at GM for what they say is a lack of support for Saturn.

When GM executives cast doubt on the brand in December by announcing publicly that it was under review, Mike Edwards, principal investor in seven Texas Saturn dealerships, said showroom traffic dropped and he decided to close three of his locations.

Edwards said GM's announcement raised doubts from lenders and customers about whether Saturn would even exist, yet the brand had nothing to do with GM getting government aid.

"It wasn't very well thought out," Edwards, who locked up Saturn dealerships in Amarillo, Midland-Odessa and Abilene. "Showroom traffic dropped considerably."

Mahindra & Mahindra Ltd. and Tata Motors have had the greatest appetite for foreign acquisitions among India's automakers and would be the most likely buyers, said Vaishali Jajoo, an auto analyst at Mumbai's Angel Broking. But Tata has cash flow problems and Mahindra might not be a good fit, she said.

Tata Motors spokesman Debasis Ray said the company wouldn't be interested in the Saturn brand or its distribution network.

"We are happy as we are," he said.

Mahindra declined to comment.

Calls were not returned by BYD, a Shenzhen, China, company that has touted goals to bring its electric and hybrid cars to the States.

GM started Saturn in 1990 as a small-car answer to Japanese automakers and billed it as a "different kind of car company." Its new factory in Spring Hill, Tenn., had more flexible work rules than traditional GM plants and more autonomy for those who built the cars, known for their plastic body panels.

Despite a cult-like following that drew thousands to annual reunions in Spring Hill, the brand never made money for GM.

As GM focused more on high-profit pickup trucks and sport utility vehicles, Saturn began to languish in the late 1990s. But in 2006, it started getting the best of GM's new models, and executives viewed it as a precursor for GM's restructuring effort.

After a good year in 2007, sales dropped 22 percent last year as the U.S. market withered. Edwards blamed the sales drop on a lack of marketing support. Analysts often criticize GM for having so many brands that it can't advertise them adequately.

"There's nothing wrong with this product lineup," he said. "But it has to be supported by the manufacturer. They were pretty plain that they weren't going to support that."

GM also has said it is reviewing the fate of its Saab and Hummer brands. Swedish-based Saab went into court protection from creditors Friday so the unit can be spun off or sold by its struggling U.S. parent.

http://www.sfgate.com/cgi-bin/articl...BU9G161TG7.DTL

[barbarian]

GM ready to pull plug on Hummer

Feb 26 2009

Get ready to say goodbye to one of the most polarizing and controversial cars to ever hit the road. General Motors (GM) has been desperately shopping its Hummer brand around, but as weeks tick by with no clear buyer it's looking like Hummer production will soon end.

GM has said it would decide by next month whether to kill the Hummer line. But that could happen as early as next week, according to the Financial Times. Hummer's heyday was in 2006, when it delivered nearly 72,000 models in the U.S., but sales fell 51% last year.

Hummer would join a number of other GM models in the automotive graveyard. Saab is also for sale, and will receive bankruptcy protection in Sweden. Pontiac will become a niche brand with just one or two models. Saturn is headed for a 2011 phase-out.

It's sad to see so many names go, but GM needs to throw out the dead weight if it hopes to become a healthy, profitable company. Saturn, Hummer and Saab generated an average pretax loss of $1.1 billion a year between 2003 and 2007, according to the Globe and Mail.

GM's survival was even more in doubt Thursday, after the company said it burned through $6 billion in its fourth quarter. Quarterly sales fell by a third to about $31 billion.

GM is closing plants and cutting production, and it expects to burn through another $14 billion this year. Its bank account is pretty much shot; it ended the near with just $14 billion in cash -- including the first $4 billion in loans it received from the government.

GM has said it needs at least $11 billion to $14 billion to stay in business, according to the Financial Times.

[XR6_190]

Not really a surprise, considering all of the different brands they have in the U.S. They have Chevrolet, Buick, Cadillac, Pontiac, Saturn, GMC and Hummer, all pretty much competing against themselves, they should have let some of these brands go years ago, after all what exactly is the point of GMC, after all aren't they all re badged Chevrolets anyway? and Saturn, don't they compete almost line ball with Chevrolet, as do Pontiac in most regards, Really I don't see why they don't just have Chevrolet, Cadillac, and maybe either Buick or Pontiac, either way more brands will go, or at least they should.

[Road_Warrior]

Not surprising at all considering they are talking about disconnecting Opel and Saturns are rebadged Opels...