General Motors announced a tentative deal Friday for Roger Penske to acquire GM's struggling Saturn brand and distribution network.
Penske's Saturn will continue to receive GM-made vehicles for two years, and is looking for another manufacturer to make vehicles that will bear the Saturn brand.
"We will have a supply of vehicles for at least two years with existing brands, and we have been in discussions during this diligence period with a number of manufacturers on a worldwide basis," Penske said Friday morning. "We would expect to have a lineup going forward, which would be manufactured by a worldwide partner."
Penske said he expects the vehicles to be manufactured in the United States if sales are sufficient.
Saturn would be wholly owned by the Penske Automotive Group. Penske said he hopes retired Chrysler President Tom LaSorda, who was advising Penske on the deal, will have a role with the company.
The deal is expected to close in the late third quarter. A price was not disclosed.
As part of its effort to narrow its offerings from eight brands to four, GM has been trying to find a buyer for Saturn. Earlier this week, the automaker said it had 16 interested parties.
A deal to sell Saturn caps a week of sweeping restructuring efforts tied to GM's bankruptcy filing, including the announcement that GM plans to sell Hummer to a Chinese manufacturer.
"We are bringing together two icons: the Saturn brand and the Penske organization," said Jill Lajdziak, Saturn's general manager. "When completed, this deal will save more than 350 dealerships and over 13,000 jobs in the United States."
Saturn dealers will be offered a franchise agreement, Penske said.
The deal includes Saturn's parts operation.
Penske called the dealer network "one of the best in the business."
The idea that Penske was closing in on a deal to acquire the Saturn brand and its dealer network appealed to franchise owners, who could have seen their businesses phased out.
In February, GM announced it would phase out Saturn after 2011 unless dealers could find a better option. In April, GM said it would close the brand down at the end of the year if a deal wasn't arranged.
"There's a lot of us that hope that's the deal because we know Roger Penske is a guy that's detail-oriented, who has capital and standing in the automotive community," George Nahas, president of Saturn of the Lakes in Tavares, Fla., said Thursday. "I think Roger Penske would be a great fit for us."
Saturn sold about 188,000 vehicles last year, down 21.7% from 2007. It has about 380 U.S. stores.
About 25 years ago, GM launched the stand-alone Saturn brand to be "A Different Kind of Car Company" in an attempt to better compete against Japanese brands. It gathered some of the industry's best car dealers to be franchise holders.
Analysts today say the value of Saturn lies with that dealer network, which gained a reputation for being consumer-friendly.
"The only real value in Saturn, frankly, is that distribution network. There is no discrete plant, there is no discrete model," said Aaron Bragman, an industry analyst with IHS Global Insight. "I can't imagine that GM is going to continue to make these vehicles much beyond selling the brand because they would be competing against themselves."
GM's Spring Hill, Tenn., assembly plant opened to build Saturn vehicles but no longer builds them and is among plants facing closure.
Penske has made a name for himself by taking struggling companies and fixing them, such as Hertz Truck Leasing in the 1980s and Detroit Diesel in the 1990s.
In 1999, he invested $83 million into United Auto Group Inc., now called the Penske Automotive Group. The group is the second-largest auto dealer in the United States and is the sole U.S. distributor of the Smart car.
Penske said Friday he would not be combining Saturn and Smart car operations.