Mystery Saturn "Investors" Enable Dealer Denial

Robert Farago
by Robert Farago
mystery saturn investors enable dealer denial

Saturn dealers, customers, managers, assembly workers, The Presidential Task Force on Automobiles, what’s left of General Motors and the mainstream media (MSM) would all like to believe there’s life after GM for the moribund “rethink” brand. A group of investors calling themselves Telesto Ventures has stepped forward to enable these champagne wishes and caviar dreams. Their plan: rebrand other people’s stuff and sell them as Saturns. It’s the same sort of plan that saw Americanized Opels in Saturn showrooms—that led to a 58 percent sales drop so far this year, compared to 2008’s miserable 188,004. (Toyota sold 158,884 Priora last year.) It was also a part of Cerberus’ original plan for the bankruptcy-bound Chrysler Corporation. Anyway, the MSM’s down with Saturn’s “rescue.” “While such a business model doesn’t exist today,’ the Detroit Free Press almost warns, ‘Telesto’s backers say the global overcapacity among automakers and the growing number of start-up firms in China and elsewhere would give the reformulated Saturn several possible sources of new vehicles.” Gullible much?

Finding automakers to work with “is not a tremendous concern,” said John Pappanastos, a group spokesman. “It would allow manufacturers not in the United States to launch without incurring the largest expense they would otherwise face, setting up a distribution network.”

Even if you buy this entirely dubious proposition, it raises one important question: Who the hell is Telesto Ventures and why should we believe a word they say? (Google is not my friend.) It’s a question whose primacy seems to have evaded the MSM. Automotive News dances around the issue.

Telesto spokesman John Pappanastos says his group is in discussions with several unnamed foreign manufacturers.

He says Telesto includes a private equity firm, Black Oak Partners LLC, based in Oklahoma City, and several other investors. It’s not clear how much money is backing Telesto and what auto experience the group has.

In the blogosphere, however, writers condemned by professional journalists as “some guy in a basement with a computer” have flagged the flaw in the “private equity saves Saturn” meme.

PE (Private Equity) Database sounds the alarm.

Big press release today regarding strong interest in General Motors’ Saturn unit by“investor group” Telesto Ventures, a consortium of sorts which includes “private equity firm” Black Oak Partners. What’s not being mentioned however, are any specific details on the two groups. The web generally provides a treasure trove of info, but this is the first time Black Oak or Telesto seems to be mentioned anywhere. It’ll be interesting to see if more details emerge on whose behind the names.

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  • Runfromcheney Runfromcheney on Apr 17, 2009

    Its GEO all over again. As a refresher, lets go over what happened with GEO. GEO was made in 1989 by Roger Smith as a cheap brand that sells rebadged imports. It was meant to strengthen GM's ties to foreign brands as well as a way to get sceptics back into GM showrooms. And since the cars had import style, handling, and quality (because they were imports), the stupid American public would start to think better of GM. It did none of that. Since GEOs were sold in Chevrolet showrooms, the GEO cars just competed with the Chevrolet cars that they sat across the lot from, and GEO was dissolved after the 1997 model year. So yeah, by going by history, turning Saturn into a GEO like venture is going to be a rousing success. /sarcasm

  • Wil Wil on Apr 27, 2009

    Would be interesting to see Tata air powered car in Saturn showrooms. Would give India a foothold in the US.

  • Max So GM will be making TESLAS in the future. YEA They really shouldn’t be taking cues from Elon musk. Tesla is just about to be over.
  • Malcolm It's not that commenters attack Tesla, musk has brought it on the company. The delivery of the first semi was half loaded in 70 degree weather hauling potato chips for frito lay. No company underutilizes their loads like this. Musk shouted at the world "look at us". Freightliners e-cascads has been delivering loads for 6-8 months before Tesla delivered one semi. What commenters are asking "What's the actual usable range when in say Leadville when its blowing snow and -20F outside with a full trailer?
  • Funky D I despise Google for a whole host of reasons. So why on earth would I willing spend a large amount of $ on a car that will force Google spyware on me.The only connectivity to the world I will put up with is through my phone, which at least gives me the option of turning it off or disconnecting it from the car should I choose to.No CarPlay, no sale.
  • William I think it's important to understand the factors that made GM as big as it once was and would like to be today. Let's roll back to 1965, or even before that. GM was the biggest of the Big Three. It's main competition was Ford and Chrysler, as well as it's own 5 brands competing with themselves. The import competition was all but non existent. Volkswagen was the most popular imported cars at the time. So GM had its successful 5 brands, and very little competition compared to today's market. GM was big, huge in fact. It was diversified into many other lines of business, from trains to information data processing (EDS). Again GM was huge. But being huge didn't make it better. There are many examples of GM not building the best cars they could, it's no surprise that they were building cars to maximize their profits, not to be the best built cars on the road, the closest brand to achieve that status was Cadillac. Anyone who owned a Cadillac knew it could have been a much higher level of quality than it was. It had a higher level of engineering and design features compared to it's competition. But as my Godfather used to say "how good is good?" Being as good as your competitors, isn't being as good as you could be. So, today GM does not hold 50% of the automotive market as it once did, and because of a multitude of reasons it never will again. No matter how much it improves it's quality, market value and dealer network, based on competition alone it can't have a 50% market share again. It has only 3 of its original 5 brands, and there are too many strong competitors taking pieces of the market share. So that says it's playing in a different game, therfore there's a whole new normal to use as a baseline than before. GM has to continue downsizing to fit into today's market. It can still be big, but in a different game and scale. The new normal will never be the same scale it once was as compared to the now "worlds" automotive industry. Just like how the US railroad industry had to reinvent its self to meet the changing transportation industry, and IBM has had to reinvent its self to play in the ever changing Information Technology industry it finds it's self in. IBM was once the industry leader, now it has to scale it's self down to remain in the industry it created. GM is in the same place that the railroads, IBM and other big companies like AT&T and Standard Oil have found themselves in. It seems like being the industry leader is always followed by having to reinvent it's self to just remain viable. It's part of the business cycle. GM, it's time you accept your fate, not dead, but not huge either.
  • Tassos The Euro spec Taurus is the US spec Ford FUSION.Very few buyers care to see it here. FOrd has stopped making the Fusion long agoWake us when you have some interesting news to report.