Recently in automotive Category

General Motors is selling its Hummer brand to Sichuan Tengzhong Heavy Industrial Machinery. Tengzhong plans to invest heavily to create a manufacturing center for Hummer in China, and has extensive plans that may include more entry-level models. GM will contribute to management and manufacturing during a transitional period.

The Hummer deal comes just days after GM's sale of Saturn collapsed, forcing GM to announce the brand's closing. Hummer's sale, while not highly priced, allows the marque to continue operations.

Saturn, the beleaguered General Motors import-fighting marque, will be winding down operations after a proposed sale collapsed Wednesday.

GM had planned to sell Saturn to Penske Automotive Group, the company behind successful trucking and auto-racing businesses. Under the agreement, Roger Penske's company would have become a retail seller of cars eventually manufactured by another company. But the manufacturer (rumored to be Renault SA) rejected the deal. Without a manufacturing agreement, Penske was unwilling to complete its purchase.

Saturn's operations instead will be wound down by GM, which has yet to set a timetable for the brand's closing. Saturn currently has 350 dealers across the United States.

General Motors agreed today to sell its Saab brand to Swedish sports car maker Koenigsegg. The move divests yet another brand from once-mighty GM, which sold Saturn to Penske and Hummer to China's Sichuan Tengzhong Heavy Industrial Machinery Company in recent weeks. In addition to GM's dealer closings and plans to shutter the Pontiac brand, the revamped General Motors will be a vastly different firm when it emerges from bankruptcy.

Equally notable, though, is how the divested car lines might fare. Three significant car companies are now held by smaller firms with niche ambitions. This inadvertently trends the auto industry toward pre-1980s merger days, when more small firms had ambitions and opportunities to grow in a splintered market. Volvo, Jaguar, Land Rover, AMC/Jeep, Mazda, Nissan, Saab--all were once independent companies with unique identities. While Chrysler may turn into Fiat USA, many other car lines have a chance to creat unique, compelling products. Expect a more competitive and innovative car market over the next decade as these companies start to differentiate themselves.

General Motors, once the largest automaker in the world, is filing for bankruptcy Monday morning, the latest step in a long process to try and save some of the company. GM, which has taken billions of dollars in government assistance, is expected to need another $30 billion to complete its reorganization.

The bankruptcy process, which should be complete over the summer, will result in the General's closing or selling many of the brands in its stable. Pontiac is following Oldsmobile into automotive history; Hummer is rumored to be near a sale, and in Europe, Opel was recently sold, with Canada's Magna taking the largest stake.

GM's filing comes barely a month after Chrysler announced its own bankruptcy. Chrysler, like GM, received government bailout funds ahead of its bankruptcy filing.

Op-ed: This author, while generally supportive of domestic manufacturing, has publicly endorsed GM and Chrysler's bankruptcies, and hopes Detroit's once-big three will be able to continue a proud American tradition.

Despite its association with Ford--the only Detroit automaker not in, or flirting with, bankruptcy--parts supplier Visteon joined the bankruptcy crowd today. Visteon, which supplies Ford with an extensive array of supplies, was battered by Ford's 40 percent sales decline. Several Visteon subsidiaries filed for bankruptcy as well.

Nearly 50 auto parts and supply companies have filed for bankruptcy in 2008 and 2009.

In the wake of its bankruptcy filing, Chrysler has sent shutdown notices to 789 dealers around the United States. The outlets, which are typically well-protected from forced closures, can be closed since Chrysler has declared bankruptcy. The 789 stores are roughly 25 percent of Chrysler's total; the resulting network of around 2300 pales in comparison to the 6000-plus locations open at the company's peak.

General Motors, which is still debating a bankruptcy filing, has announced plans to close 2600 dealerships but details have not been disclosed.

Beleaguered auto manufacturer Chrysler filed for Chapter 11 bankrupty protection today in a move encouraged by the Obama administration. The bankruptcy filing is intended to rapidly clear Chrysler's debts and smoothe a path to a partial acquisition by Italian automaker Fiat.

Chrysler, which received billions of dollars from the United States government, then asked for more to stay afloat, is now conceding an inability to meet its obligations. Chrysler will idle its production lines for an extended period while the company restructures. In an interesting twist, the reorganized company will become majority owned by its employees via an independent trust controlled by the United Auto Workers union's healthcare fund. Fiat and the US government will own the rest.

No announcements have been made at this time regarding Chrysler's product lines or dealer network.

Several stores formerly profiled on Timely Demise are in the news today.

Pier 1, which announced up to 125 store closings in February, has closed 22 stores so far, 20 of them through lease negotiations.

Aeropostale, which has strong sales results in recent months despite the economy, issued another strong sales report, despite the Jimmy'Z store closings announced recently.

Advantage Rent-a-Car, which filed for bankruptcy in December, has been purchased by Hertz, which reportedly gives the acquiring firm a brand for budget-minded renters.

And in New Jersey, the recently bankrupt Marty's Shoes chain has been brought back to life. Its former CEO and original owner have purchased the Marty's brand out of bankruptcy and opened stores in four locations. An ecommerce site is operational, and plans are to open nearly 20 stores.

Updated April 10.

In Alabama, Big 10 Tires filed for bankruptcy protection, citing insufficient operating funds. The tire retailer has 104 retail stores across three southern states. Big 10 Tires plans to keep its doors open while negotiating rent and debt relief.

Popular RV maker Fleetwood filed for Chapter 11 bankruptcy protection and is looking to sell itself. Fleetwood is closing factories and service centers but expects to continue operating during the proceedings. High fuel prices and the recession combined to greatly reduce sales, which led to the bankruptcy filing.

Interesting article in the New York Times this morning discusses how rental car companies are dealing with the downturn. In short: their cars are getting worse. Usage time for a typical car has crept closer to two years and total mileage can pass 30,000.

The reason for this is a bit counterintuitive: rental companies have to sell their old cars to make way for new ones. With the auto market in shambles, they can't move the old inventory profitably, so they can't afford (or make room for) new ones, leaving an aging auto fleet with few options.

Swedish carmaker Saab, which is currently owned by General Motors, has applied for creditor protection as a first step toward a sale. Saab is looking for funding that will aid the marque in a sale or a spinoff from GM. Saab, which was founded in 1937, was purchased by GM in 1990. GM, of course, is experiencing extensive fiscal woes and thinks a slimmer brand lineup is part of a key to its survival. It is also considering moves for Hummer and Saturn.

Legendary auto company Checker Motors, which once made cars like the Checker Cab, filed for bankruptcy protection due largely to declining sales at General Motors. Checker, which in recent decades has focused on stamped and welded car parts, is planning to reorganize and continue operating.

New York magazine has an article in this week's issue on the increase in bankruptcy filings for businesses in the nation's largest city. The angle: many of the chapter 11 filings, rather than reposition the filer for a restructuring, are instead precursors to going out of business. "There is not financing available for the reorganization process," says a lawyer in the article. A music studio and car dealership owner are quoted as wondering how they can possibly stay open.

Flying J cited a cash shortage in a Chapter 11 filing Monday, brought on by the steep decline in oil prices and tight credit markets. Flying J, which has 250 service and travel stations nationwide, is one of America's largest privately held companies. The company plans no change in operations during the reorganization.

Op: One would think that declining oil prices would not have a material effect on a service station--indeed, the lay person figures it could help, not hurt, margins, since the stations could lower prices more slowly than the futures market. But if Flying J secured its oil at too high a price, and competitors with better buying can lower prices faster, this wipes out profitability.