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GM’s Chips Begin to Fall – HUMMER and Saturn Sold

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General Motors’ June 1 bankruptcy declaration was quickly followed by the announced sale of HUMMER to China’s Sichuan Tengzhong Heavy Industrial Machinery Company (June 2) and Saturn to Roger Penske’s Penske Automotive Group (June 5). Having the futures of both of these brands out from under the General Motors umbrella can give many American dealerships and their communities cause for celebration.
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Sichuan Tengzhong Heavy Industrial Machinery Company buys HUMMER
HUMMER is an iconic American brand modeled after the military HUMVEE. That a Chinese company has come to the rescue of HUMMER is nothing if not ironic. Jim Taylor, formerly head of General Motors’ Cadillac brand and more recently heading HUMMER must be quickly learning Chinese.
Reportedly, the Chinese HUMMER plan is to continue to produce the HUMMER H2 at AM General in Indiana and H3 at a General Motors plant in Fairfax, Kansas for the near future. As investments are made updating the H2 and H3 more and more production may move to China to get lower labor and piece costs. Given HUMMER’s image as gas guzzlers it would be expected that STHIM would quickly invest in more fuel efficient powertrains including plug in hybrids and diesels. STHIM also has global plans for the HUMMER brand, so HUMMER’s prospects have certainly improved over the course of a week.
Penske Automotive Group Acquires Saturn
What may be the jewel in GM’s crown is Saturn. With almost 400 of the most respected dealers in the country. Saturn dealers are known for delivering perhaps the best sales experience among mainstream brands. Women especially like the treatment during the sales process. You couldn’t have asked for a better husband of Saturn’s uniqueness than having Penske acquire the brand. Penske’s operations are run with the utmost professionalism from his Penske Automotive dealer group to his Indianapolis 500-winning racing teams.
As with the HUMMER deal with the Chinese, Saturn will continue to source vehicles from General Motors for a time. Remember, Aura, Vue and Astra are based on Opel (just spun off to Canadian parts giant Magna) products. The Outlook is an all-American Lambda Crossover SUV built in Michigan. The Sky sports car is dead by the end of 2009.
While future Saturn products could be sourced from anywhere, it appears that a front-running source is Renault Samsung from South Korea. Renault Samsung sells vehicles based on present generation Nissan platforms but with unique sheetmetal and interiors. The Samsung vehicles are styled more in the European idiom, but American sized. That their appearance will be unlike that of other cars on the American road will be a benefit if Penske decides to go that route.
Penske has brought in Tom LaSorda from Chrysler as senior manager. Saturn’s present general manager Jill Lajdziak is expected to continue to run the distribution side of the business while LaSorda sorts out the product plan and sourcing.

1 Comment

  • barbara cahill| June 11, 2009 at 4:09 am

    I bought my third Saturn this past December. It is an Astra 2 door hatch with a stick shift and, let me add, the cutest car around. I’ve had people come up to me and ask what kind of car I’m driving. Everyone likes the style. In my opinion Saturn missed the boat on this one. In the Cleveland area I’ve only seen 2 such vehicles on the road and one is still at the dealership where I bought mine. I’m glad Saturn will continue on because I will continue to buy them as long as I’m around.

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