General Motors’ Saturn brand was supposed to revolutionize the way small cars are built and sold in the United States.
(M. Spencer Green/Associated Press)
Saturn’s demise may cost state 450 jobs
But GM will still back warranties for car owners
General Motors’ Saturn brand was supposed to revolutionize the way small cars are built and sold in the United States.
(M. Spencer Green/Associated Press)
When Penske Automotive Group Inc.’s plan to buy the Saturn auto company from General Motors Corp. suddenly collapsed this week, so too did hopes of employees and owners at Massachusetts’ nine Saturn dealerships.
Industry analysts said there is little hope that GM will find another buyer.
Dealerships will be “caught in the wind,’’ said George Magliano, director of automotive industry research for IHS Global Insight.
“There is no future for them at this point,’’ Magliano said. They are “the big losers in this,’’ he said.
As a result, Massachusetts will lose about 450 jobs, said Robert O’Koniewski, executive vice president of the Massachusetts State Auto Dealers Association. Most dealerships have about 50 employees, he said.
Calls to a half-dozen Massachusetts dealerships were not returned yesterday.
Nationwide, about 13,000 employees at 350 dealerships would be out of work.
For Saturn owners in the state, however, the brand’s demise will not leave them stranded: GM said its other dealerships will honor Saturn warranties.
Saturn, which was formed in 1985, billed itself as a “Different Kind of Car Company’’ because management and unionized auto workers partnered to create a line of small cars designed to compete with foreign imports.
GM planned to sell the division to Penske to help speed its recovery.
The company filed for bankruptcy protection this year with $173 billion in debt and $82 billion in assets and has been under intense pressure from the Obama administration to come up with a survival plan.
As part of its restructuring, GM closed its Pontiac division last spring and undertook efforts to sell its Hummer, Saab, and Saturn brands. The company said it would sharpen its focus on its four core brands: Chevrolet, Cadillac, Buick, and GMC.
The deal fell through after Penske, whose chief executive is former race car driver Roger Penske, failed to secure an agreement with Renault SA, of France, to supply Saturn autos. Discussions between Penske and Renault ended Wednesday.
O’Koniewski said the elimination of brand names means consumers will probably see decreased competition between dealers and face fewer choices when buying a car.
“That can mean higher prices,’’ he said.
The number of auto dealerships in Massachusetts has dropped from 560 in 2007 to 437 this year, O’Koniewski said, including impending Saturn closings.
Haig Stoddard, another automotive industry analyst at IHS Globe Insight, said he expects GM to stop Saturn production by the end of the year.
Megan Woolhouse can be reached at mwoolhouse@globe.com. 
© Copyright 2009 Globe Newspaper Company.
