Deal collapse sends Saturn dealers scrambling

WASHINGTON (AP) — Charlie Eickmeyer says he was a fan of Saturn vehicles years before he was able to drive. Today he’s in shock.

So were employees at Day Automotive Group in Pittsburgh when they read the news online that a deal to rescue Saturn had fallen through. And Mike Martin is left wondering how he can move the Saturns left on his lot or what to do with the employees at his Manassas, Va., dealership now that the brand is apparently doomed.

“It seemed like the deal was going through,” said Eickmeyer, 34, who started following Saturn when he was 10 and now runs a Web site for enthusiasts of the brand. “I was really excited about the next chapter in Saturn’s history.”

The chapter was supposed to be a future under former race-car driver Roger Penske with the novel approach of filling dealerships with cars made overseas and rebranded as Saturns.

Instead, the collapse of talks between GM and Penske Automotive Group Inc. this week likely means the end of the nearly 25-year-old brand, sending Saturn dealers such as Martin and Day Automotive scrambling over what to do with their soon-to-be empty showrooms and leaving the company’s loyal owners mourning the apparent demise of a company that built its reputation on customer care.

GM said it will cease making Saturns at plants in Kansas, Mexico and Michigan almost immediately but will continue to honor warranties after Saturn dealers stop selling cars. Saturn owners can still get their vehicles serviced at GM’s remaining dealerships once their Saturn dealer shuts down.

Saturn’s future has been in doubt since GM said earlier this year it planned to phase out the brand by 2011. GM was shrinking to four brands as part of a deep restructuring. Just five days after GM filed for bankruptcy, Penske emerged as a possible buyer for Saturn. Wednesday, Penske backed out, unable to find another company to supply vehicles after GM stops making Saturns in two years.

So, more than 350 Saturn dealers expecting to hear about the closing of a deal instead are faced with shutting down their showrooms if they don’t have a viable contingency plan. Thousands of jobs are in jeopardy. Dealers will have to figure out how to sell remaining vehicles to customers who may be skittish over the news that the brand will disappear. But they won’t close immediately — GM gave dealerships until October 2010 to wind down their operations.

Many Saturn dealers have already been through difficult times recently, hit by a combination of one of the worst downturns in auto sales in decades and the uncertainty about the brand’s future. In a clear sign of that pain, GM reported Thursday that Saturn sales were down 84 percent in September from a year ago. But about 13,000 jobs are still tied to Saturn, the vast majority of them at dealerships.

GM had a midday conference call with dealers to discuss the closures. Dealers said executives expressed shock and disappointment that the Penske deal fell through, but didn’t provide much detail on the specifics.

The mood was grim Thursday at dealerships, where owners said they were blindsided by the news.

“This is nothing short of the bride running away at the altar,” said Lou Gonzales, president and owner of the Saturn of Antelope Valley dealership in Palmdale, about 60 miles north of Los Angeles. “The millions of Saturn customers across the United States, I’m sure are disappointed. But they will not be left out in the lurch.”