Saturn dealers closing before division leaves GM's orbit

Some Saturn dealers are closing up shop rather than wait to see what the future holds, according to the Automotive News. The trade newspaper reports that since General Motors announced plans in February to gradually wind down Saturn operations by the 2012 model year, sales have plummeted, and the number of retailers nationwide dropped from 420 at the beginning of the year to 384 by early April. More dealers have closed since, including four in the Midwest last week.  (Read “Saturn dealer says new ‘partner’ will supply cars after GM” and “Saturn may leave General Motors’ orbit.”)

Sales have fallen off at a rate faster even than other brands in what has been a dismal period for the industry, dropping by 59.6 percent in March. Dealers say customers have been scared off by the brand’s uncertain future. (Read “Car buyers hesitant to buy from bankrupt automakers.”) That uncertainty is compounded by the possibility of a GM bankruptcy, and speculation the carmaker might have to spin off or eliminate underperforming brands sooner than originally thought.

Meanwhile, a group of investors, including some Saturn dealers and Oklahoma City-based Black Oak Partners, a private equity group, has announced it is bidding to take over Saturn. The group is one of several Saturn says have expressed interest in buying the division.  The group says its plan would be to begin by selling models produced by GM, but eventually change the product mix to include small cars and more fuel-efficient models from other manufacturers.

Regardless of whether the division is sold or phased out, Saturn owners and car shoppers should not necessarily panic. As we’ve reported before, buyers might not notice any change in day-to-day operations following a bankruptcy, and Saturn service and warranty work would most likely be taken on by other GM dealers if yours goes out of business. (Read “My dealer closed! What do I do?” and “Q&A: What happens if an automaker goes bankrupt?”)

If you’re the kind of buyer who keeps a car for a long time and aren’t afraid of possibly faster depreciation than might be seen with similar models from other brands, now might be a great time to consider Saturn. The Aura sedan has performed well in our testing, and is a Recommended model. Between the slow new-car market and the brand’s uncertain future, it might be a great time to make a deal.  

We will continue to monitor this fast-moving story, reporting here in the Cars blog and also updating advice and news on the Auto Crisis hub.

—Jim Travers

Comments

[Michael Spadoni]

I'm currently on my third Saturn (an '07 Ion 3 with the 2.4 engine). This past week, I went to my dealer (Saturn Of West Sahara, Las Vegas) for an oil change and check of those vital fluids. The service rep tells me that things are doing fine at the dealership and he's not worried about the talk about Saturn's future. But when I sat in the waiting room/showroom, it seemed quite empty with relatively few buyers--certainly less busy than when I've visited in the past.
I know CR didn't think much of the Ion, but it's a great car with the right equipment--and it has been outstandingly reliable. Considering everything, I'm holding onto the car, no matter what the future holds. But if weren't for Saturn, I probably would never have considered a GM car.

[JR Belcher]

My family (and both my neighbors) love our Saturn vehicles and our local Dayton, Ohio dealership. Our car currently has +200K miles and is performing wonderfully. I have would not hesitate to buy another Saturn, however, there is some speculation that China may be an interested player in Saturn and I would never want a Chinese-associated car in my garage. As a result, I will wait to see where Saturn ends up and, if it remains American, I will definately consider this quality nameplate when my current Saturn "gives up its ghost".

[Robert Berkey]

It's a darn shame about Saturn. I drive a 2008 V6 Saturn Vue that I bought after test driving just about every comparible small SUV. I just love this car. It is easy to drive, gets 22-25 MPG on regular gas. Not bad for a 5 seater that can tow 3000#.

This thing has all of the features of my wife's Mercedes ML350 but costs $30,000 less.

I tend to drive a vehicle for the long haul, 200K miles, so trade-in value is not a big concern but I am concerned that GM is not going to honor my 100,000 mile warranty.

[ed]

Who’s at fault for the American automobile industry collapsing to the point it needs to turn to the government for help! Well if you really look at the problem everyone is. The government is for allowing so many imports vehicles in to our country, with out considering the out come of what will happen to the American cars. The public for forgetting where they live, work, and play freely (in America), the automobile manufacture for not thinking about the American public. When they were building vehicles like they were toy model cars. Now we have a president that says he will save jobs and get the economy going to put people back to work. But the government forces the American manufactures to close car dealerships, down size the plants. Putting serve hundreds of thousands of people out of work that have survived off, The American automobile business. What did they do for the import vehicles sold in this country? They are forcing American car dealers to open more import dealerships. Pushing the American plant worker to find work for the import manufacture in this country. How does this help the American automobile business in this country? Where we employ and keep the tax payers money in this country. Instead of shipping it to Japan or Korea. The government took the American publics tax dollars to help out the American built vehicle companies, on the same hand forced Americans to help build sell and open more import dealerships in this country off our tax dollars. How have we helped the American economy by allowing the government to do this????? The government, the public, the manufacture needs to think about this country America and stop thinking about greed. Every import vehicle sold; bought and built in this country will keep bring down the American automobile industry. Which we all know that the down turn of the automobile industry affects the American economy.