Report form Detroit Free Press
General Motors is talking with several potential buyers for its Saturn division and hopes to close a deal this year, the troubled automaker said Monday.
The clock is ticking on the brand, which was originally given to 2011 but now is to die or be sold at the end of this year under GM's latest business plan.
"A number of potential buyers have surfaced and expressed interest in the Saturn brand and retailer network," GM said in a statement.
Last week, GM CEO Fritz Henderson the company was talking with parties who might interested in "basically buying the distribution rights" or "basically affiliating with the distribution channel, which would then involve us phasing out the Saturn brand as part of that."
GM has retained Stephen Girsky's S.J. Girsky & Co. to advise the effort. Girsky has been an adviser to the UAW and GM and is a former Morgan Stanley automotive analyst.
In April, a group of Saturn dealers named Telesto Ventures announced a pitch to acquire the Saturn brand. Roger Penske's Penske Automotive Group in Bloomfield Hills is another potential bidder, a person familiar with the confidential process told the Free Press.
Other potential suitors are not publicly known.
Pluses and minuses
Industry observers are uncertain what a standalone Saturn might look like. A good argument can be made that the dealer network would be appealing to a foreign automaker looking to enter the U.S. market.
"They were hand-picked, best-of-the-best kind of dealers, and many of them are still considered elite kind of dealers," said Sheldon Sandler, a dealer consultant with Bel-Air Partners. "Somebody who wanted to get into the United States, it would not be a bad idea to piggyback on the brand. That might be worth something to somebody if they already had manufacturing capability."
Nevertheless, he said, there are several hurdles, most notably, the brand's tanking sales. Saturn sales are down 58.3% through April compared with the same time period last year.
"Dealers are holding on, but ultimately they are just dying because they are losing money month after month," Sandler said. "If something doesn't happen soon, there's not going to be any distribution left."
Joe Serra, owner of Serra Automotive Group, which owns two Saturn dealerships, is hoping for the best.
"It is business as usual right now," he said. "In the near future, I think we've been told maybe as early as 30 days, maybe longer, they're going to identify one of these potential suitors if they can go further with them."
GM is staying afloat on $15.4 billion in federal loans and faces a June 1 deadline to restructure its debt outside of court or likely enter bankruptcy.
In its third restructuring plan since December, GM said it would resolve how it will get rid of its Hummer, Saab and Saturn divisions by the end of the year. It will also end its Pontiac brand.
The clock is ticking on the brand, which was originally given to 2011 but now is to die or be sold at the end of this year under GM's latest business plan.
"A number of potential buyers have surfaced and expressed interest in the Saturn brand and retailer network," GM said in a statement.
Last week, GM CEO Fritz Henderson the company was talking with parties who might interested in "basically buying the distribution rights" or "basically affiliating with the distribution channel, which would then involve us phasing out the Saturn brand as part of that."
GM has retained Stephen Girsky's S.J. Girsky & Co. to advise the effort. Girsky has been an adviser to the UAW and GM and is a former Morgan Stanley automotive analyst.
In April, a group of Saturn dealers named Telesto Ventures announced a pitch to acquire the Saturn brand. Roger Penske's Penske Automotive Group in Bloomfield Hills is another potential bidder, a person familiar with the confidential process told the Free Press.
Other potential suitors are not publicly known.
Pluses and minuses
Industry observers are uncertain what a standalone Saturn might look like. A good argument can be made that the dealer network would be appealing to a foreign automaker looking to enter the U.S. market.
"They were hand-picked, best-of-the-best kind of dealers, and many of them are still considered elite kind of dealers," said Sheldon Sandler, a dealer consultant with Bel-Air Partners. "Somebody who wanted to get into the United States, it would not be a bad idea to piggyback on the brand. That might be worth something to somebody if they already had manufacturing capability."
Nevertheless, he said, there are several hurdles, most notably, the brand's tanking sales. Saturn sales are down 58.3% through April compared with the same time period last year.
"Dealers are holding on, but ultimately they are just dying because they are losing money month after month," Sandler said. "If something doesn't happen soon, there's not going to be any distribution left."
Joe Serra, owner of Serra Automotive Group, which owns two Saturn dealerships, is hoping for the best.
"It is business as usual right now," he said. "In the near future, I think we've been told maybe as early as 30 days, maybe longer, they're going to identify one of these potential suitors if they can go further with them."
GM is staying afloat on $15.4 billion in federal loans and faces a June 1 deadline to restructure its debt outside of court or likely enter bankruptcy.
In its third restructuring plan since December, GM said it would resolve how it will get rid of its Hummer, Saab and Saturn divisions by the end of the year. It will also end its Pontiac brand.
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