GM Denies Reports Saturn Faces Elimination in New Restructuring Round

Saturn sales last month fell 1.9% and deliveries so far this year are off 18.6%, according to Ward’s data.

James M. Amend, Senior Editor

July 7, 2008

2 Min Read
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A report that suggests General Motors Corp. may kill its Saturn brand is “wild speculation,” the auto maker says.

Saturn believes its product portfolio is uniquely positioned to attract consumers who seek relief from rising fuel costs by choosing more economical passenger cars over pickups and SUVs, says spokesman Steve Janisse.

Citing sources close to GM’s restructuring, The Wall Street Journal reports today more job cuts may come after the company’s board meets in August and the Saturn brand ranks among businesses it may axe to speed its turnaround in the U.S.

“Wild speculation,” Janisse tells Ward’s. “We’re feeling good and doing well. People are moving to our segment. Where we play is where the market is moving.”

Saturn sales last month fell 1.9% and deliveries so far this year are off 18.6%, according to Ward’s data.

GM Chairman and CEO Rick Wagoner said last month the auto maker would study whether to sell or rework Hummer, a brand built on gas-guzzling SUVs. “We are considering all options,” Wagoner said at the time.

But even without Hummer, many critics think GM still would operate too many brands in the U.S. Billionaire investor Kirk Kerkorian suggested earlier this year the auto maker kill Hummer and Saab, a Swedish division that has made little money for the auto maker since it was acquired fully in 2000.

Decision to delay Saturn Aura redesign fuels speculation of brand’s future.

Saturn also has struggled as a money maker and news GM would delay a redesign of the Aura midsize sedan spurred Internet bloggers last week to speculate its days were numbered. However, Janisse says the decision to delay the Aura redesign is based on the car’s rising popularity.

The Aura originally was scheduled for an exceptionally short lifecycle of about 3.5 years, but GM has decided to move it to a more typical 5- to 6-year lifecycle.

Aura sales through second quarter rose 21% vs. like-2007, according to Ward’s data, which is adjusted for sales days.

The Aura also receives a 6-speed transmission for its 4-cyl.engine model this fall, which would provide highway fuel economy of 33 mpg (7 L/100 km). “That would lead the segment,” Janisse says.

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