Penske Wins Saturn; Castroneves Wins Indy

Last month we talked about the possibility of Roger Penske taking control of Saturn and why that made good business sense. Today, he went ahead and did it. Penske Automotive and GM reached an agreement for a price of $100-200 million, said Bloomberg. And let’s not forget: Helio Castroneves, driving a Penske car, won his third Indy 500 three weeks ago. These things are not unconnected.

But the Saturn deal seems to make everybody happy—not only because of Penske’s great background and ability in the automotive world, but because GM will contribute its vehicles to Saturn showrooms for at least two years. After that, according to Penske, “We would expect to have a line up going forward, which would be manufactured by a worldwide partner.” And he hopes these cars will be made in the U.S.A.

Further, he intends to have all 350 dealerships and 13,000 Saturn employees remain, at least for now. More details are in the news release here. That distribution network is what makes Saturn valuable, along with “a passionate customer base,” as Penske put it, that could well be revived.

His most relevant experience has been creating and operating the second-largest U.S. car distributorship group. But racing at Indy is in some ways more demanding than running a car company. It requires not only money and passion but close attention to detail and superb team management skills. If he can run Saturn like he wins races, Roger might even revive the company that GM did its best to kill off.

Tell us what you think are some of Saturn’s “greatest hits”—how about the Sky, the Vue, the Aura—or its biggest bombs?

—jgoods

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In California: Drive fast for the good of the state!

California is broke, and I have a solution!

There’s been all kinds of news in the last few weeks about California’s budget crisis and how the state is nearly bankrupt. They’re even starting to delay construction projects and highway improvement plans.

The idea struck me while I was driving 50 miles per hour in a 45 zone and getting passed like I was going 25. Yeah, Californians drive fast. And don’t use turn signals (unless you count the action of actually changing lanes as a signal to get out of the way).

I have a theory that speeding is so rampant here because the opportunities to drive faster than 10 miles per hour are actually quite rare due to the jammed freeways and frequent car accidents. But when an open space appears, everyone puts the pedal to the metal in an effort to be the first car to arrive at the next traffic jam, just 2.4 miles ahead.

People drive so fast here that I saw a car actually flipped onto its top on a straight section of interstate. I can see how that might happen on a 2-lane mountain road, but on a 6-lane freeway the only explanation is speeding and weaving through traffic. I hope that person survived, but if not, it’s a fine example of Darwin’s Theory in my mind.

So, back to my budget solution: The population of Los Angeles is 3.6 million people. All of them speed. Of all the times I’ve been down here, I’ve never seen a car pulled over for speeding. So there you have it.

Three and a half million $100 speeding tickets would make a hefty dent in California’s budget problem. I’ll bet most residents would even be okay with paying their tickets on monthly installment plans, providing a steady stream of revenue for a bankrupt state.

How are the drivers in your neck of the woods?

-tgriffith

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