Saturn Seems Like a Good Deal For Fiat or the Chinese

Posted by: David Kiley on January 19, 2009

General Motors is known to be looking for an arrangement with some company to buy or otherwise take Saturn off its hands.

Sources say not too many entities have come forth with an offer; neither automakers nor private equity. Perhaps it is the credit markets. Despite medicore sales, I think Saturn actually presents a great opportunity for some automaker.

Today, some news services are reporting that Italian automaker Fiat is in talks with Chrysler about some kind of alliance, purchase of assets, or some such thing that would enable Fiat to, among other things, re-introduce Alfa Romeo to the U.S. utilizing Chrysler’s distribution. Huh?

Far be it from me to kibitz. But as GM is looking for little to no money to change hands on a deal for Saturn, why not take Saturn and its excellent dealer network. Any company do step up would contract with GM to continue supplying Saturn vehicles to the network. This is little different than the deal, for example, Suzuki has to take pickups from Nissan and sell them under their name at their dealerships.

Meantime, at some point in the future Fiat could plan to change the name of the network to Fiat Saturn, and plan to introduce Fiat cars to the showrooms. Federalized Fiats could be a good way to supply future product to the dealership. It could also go with Fiat/Saturn/Alfa-Romeo and solve the distribution issue for Alfa.

It may sound a little goofy, but given the seriously nice product line in Saturn today, and the quality of the dealerships, it seems like a better fit than using Chrysler dealers to me.

Or how about the Chinese automakers. If I was BYD or Brilliance or any of the others hoping to crack the U.S. market, I would try and do a deal with GM on Saturn as a fast way of establishing a high quality sales channel. I asked the head of Brilliance’s U.S. effort if the company might be interested. He said it wasn’t interested in any deal like that. They’d rather start from scratch. Good luck with that.

I interviewed Saturn chief Jill Lajdziak at the North American International Auto Show. And this is what she had to say about the present and future of Saturn.

Reader Comments

CARSAGE in CA

January 19, 2009 5:54 PM

I think you made some good points.
Although its brand equity is heavily depleted, it has a good base for some manufacturer (Chinese) to develop.
The product quality and appeal is good in my opinion. Happy New Year.

Jim Ahlstrom

April 16, 2009 3:01 PM

I recently faxed Fisker Automotive along with a copy of Saturn's letter in which it was indicated Saturn might look to other suppliers for product. Knowing Fisker is seeking a naitonal dealership, i thought the Saturn dealerships would solve Fisker's quest for a national outlet for its cars.

Chiller

April 24, 2009 11:51 AM

With FIAT in talks with Opel, the Saturn option makes a lot of sense. Saturn sells Opel designs now, so:
a. FIAT/Opel design cars for Saturn to make and sell
b. Saturn dealer network gives FIAT entry to North America
c. Saturn factories produce FIAT/Alfa/Lancia product for North America
d. This deal puts pressure on Chrysler

To me, this scenario makes mouc more sense than Chrysler/FIAT.

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