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Potential Saturn spin-off attracts foreign interest, adviser says


David Barkholz

Automotive News | March 17, 2009 – 6:13 pm EST

 

Potential Saturn spin-off attracts foreign interest, adviser says
 

A group studying Saturn’s possible spin-off from General Motors has been approached by GM competitors, including foreign manufacturers, about selling their cars under the Saturn brand, an adviser says.

Steve Girsky, long-time industry consultant who is leading GM’s task force, declined to name which automakers have talked to the group. He called the inquiries “informal.”

Key Saturn dealers pushed for a feasibility study after cash-strapped GM announced last month that it would wind down or terminate the Saturn brand after 2011. The move is part of the viability plan GM submitted in a bid for an additional $16.6 billion in federal aid beyond the $13.4 billion in U.S. loans keeping the company afloat.

Girsky said in an interview today that the task force is assessing whether a spin-off could procure enough product and sell enough vehicles to make it viable for the 400 Saturn dealers now operating.

The spin-off would offer car manufacturers an opportunity to build vehicles in under-used GM assembly plants or provide a ready-made U.S. distribution network for their products, Girsky said.

The spin-off could count on Saturn’s current vehicle lineup through 2011, Girsky said. Ideally, the new company would want to begin bringing in additional product from GM or others before that time, he said.

They would all sell under the Saturn brand. To keep a family resemblance for vehicles possibly coming from a variety of automakers, the new company could have light design capability, he said.

The task force includes Saturn general manager Jill Lajdziak, four Saturn dealers and former General Motors Acceptance Corp. CFO Sanjeev Khatri, Girsky said. He said the group expects to complete its work by late April.

Several carmakers already market vehicles made by competitors, Girsky said. Chrysler LLC, for example, is making Volkswagen AG’s Routan minivan.

Girsky said it is too early to seek potential investors in the spin-off. He said GM probably would require dealers participating in the new company to release GM legally for some of the costs of closing a brand. State franchise laws can require automakers to buy back inventory and compensate dealers for losses associated with discontinuing a brand

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