Penske-Saturn deal could change how cars are sold
— -- Roger Penske's pending purchase of the Saturn brand from General Motors could be the beginning of the biggest change in how cars are sold since the dawn of the auto industry early last century.
Penske can shop globally for low-cost automakers able to build to his specifications quickly, fielding Saturns built in, say, China or India and developed for half the cost and in half the time it would take traditional automakers.
Fast turnarounds would let Saturn exploit emerging trends sooner. Lower costs could keep it profitable in brutal times.
The deal, expected to close in October, creates "a new business model in this industry," says Jack Nerad, market analyst at car-shopping service kbb.com. "The distribution side of the business controls the brand, and manufacturing is conducted by one or more subcontractors."
"What if we're first? What if we win this race" to field must-have, low-cost, fuel-efficient vehicles, asks Marcy Maguire, CEO of Maguire Automotive Group, with an enthusiasm rare lately from beleaguered dealers. She owns Saturn dealerships in Toms River and Bordentown, N.J.
Maguire, a director of the National Automobile Dealers Association, foresees "fresh, distinctive" Saturns "from whatever area of the world" that can build to suit. "We live in a global community," and buyers don't seem to care who makes a car if it suits their needs, she says.
"It truly is revolutionary," she says.
Such a setup would hurt the United Auto Workers union here initially, though Penske says he'd eventually like to make some Saturns in the USA.
No price was disclosed for the deal, announced Friday. GM will provide Saturn with Aura sedans and Vue and Outlook SUVs until 2011. The deal rescues 350 Saturn dealers, who had been expecting to go out of business, and, for now, 13,000 jobs.
Penske, known for his winning IndyCar race team and a big truck-leasing operation, is also a large-scale auto dealer and is U.S. distributor of the Smart car.
Selling Saturn to the respected Penske "is like finally finding your puppy a good home," Nerad says.
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