Saturn Brand Shuttered After Penske Pulls Out Of Deal With GM
I was dubious of this deal from the beginning. Penske wanted to run Saturn as a service model while outsourcing manufacturing. The sticking point appeared to be that Penske couldn't find a manufacturer to partner with. There's a reason for that. I don't believe this is a sustainable business model for heavy manufacturing. Much of the profit of a car manufacturer is derived from lean process methods and advances in manufacturing. So to outsource that core competency a little like outsourcing many of the crown jewels of the company. Penske apparently didn't want to absorb the massive capital expenditures and liabilities associated with a full Saturn purchase. Why would any manufacturer want to take these burdens on without substantial capital guarantees? It's all about who wants to absorb substantial risk.
Saturn is a brand that never realized its potential. Originally, a Saturn car was meant to be a gas efficient response to Japanese imports. GM lost its focus and never produced that car. Instead GM launched Saturn as the "anti-GM" brand with mild success. Ironically, Saturn probably had the best lineup of vehicles of any domestic auto brand before this crisis hit. Yet, now it appears to be another victim of GM's mismanagement.
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