Saturn, Saab dealerships to close in Canada

AP FILE PHOTO

GM's deal with Penske was to retain all 13,000 Saturn employees for the immediate term.

Tony Van Alphen

BUSINESS REPORTER

Saturn will no longer be in the Canadian auto universe by the end of this year.

Forty-six Saturn-Saab dealerships across the country will close during the next few months after General Motors Co. indicated yesterday that the Canadian network won't be part of any sale to U.S.-based Penske Automotive Group.

GM had reached a memorandum of understanding with Penske earlier this year for the rights to the brand and other assets.

At that time, Penske and GM said they had been exploring the sale and distribution of Saturn vehicles in Canada.

"It was determined that the business case did not support distribution of Saturn vehicles in Canada," said Stew Low, director of communications for GM of Canada.

Low added that as Saturn dealers cease operations, customer service, parts and warranty needs will transfer to local GM dealerships.

Under the proposed deal, Penske – owned by former race car driver Roger Penske – will sell several GM-produced models until the end of 2011. Penske is searching for new manufacturing partners to provide its dealers with vehicles that would be sold under the Saturn name.

GM launched Saturn in 1990 as a revolutionary way of producing and selling small autos in North America. But after a promising start the company sputtered. Sales in Canada slid 27.4 per cent to 18,729 last year from 2007.

Related links:

Blog: Will you miss Saab and Saturn?

More videos from Wheels.ca and our partners