The Renault Board balks at Ghosn's Saturn plan.

The key to the mystery behind the sudden end to General Motors Company’s effort to sell Saturn lies with the board of Renault-Nissan. Renault-Nissan chief Carlos Ghosn had signed off on the deal that would have cleared the way for Saturn to begin selling vehicles built by Renault-Nissan’s South Korean affiliate, Samsung, according to a source familiar with the negotiations.

The deal would have raised Samsung’s profile in the global industry and increased the utilization-rate at the Korean company’s manufacturing center, while providing Saturn with new vehicles.

Renault’s chief financial officer in an interview with Bloomberg news has acknowledged it was in talks with racing mogul Roger Penske, who is also the founder of the Penske Automotive Group of Bloomfield Hills, Michigan.

Penske, who prefers to maintain a low profile away from the track, had never identified his potential partner. That is the reason for his carefully worded statement where Penske said the “board” of an unidentified company led to the collapse of the deal.

Ultimately, Ghosn and Penske, two the most formidable executives in the car business, could not convince the Renault-Nissan board that a Samsung-Saturn alliance was a good idea.

It demonstrates a complete lack of faith in the U.S. auto market where Nissan is posting heavy losses. It also might indicate a lack of faith in Ghosn’s judgment. The list of possible reservations also include concern about creating a new-competitor for Nissan in the US and worries about potential liabilities for Renault-Nissan if the Saturn venture failed, analysts suggested privately.

Nor had Penske lined up an alternative to Samsung, sources noted.

Penske, who personally invested hundreds of hours through the summer negotiating the various details of the complicated three-way deal, apparently believed the agreement was final complete right up until the vote by the Renault-Nissan.

In fact, Penske Automotive Group had already sent invitations to the more than 300 Saturn dealers to come to a special meeting October 6. The meeting is now cancelled. If Penske could not make work the idea of a “virtual” car company, where the manufacturing, engineering, design, marketing and sales come from different suppliers under the direction of one entrepreneur,  it is doubtful anyone can at this point.

Meanwhile, GM is preparing to move quickly to liquidate the Saturn brand now that deal Penske has gone sideways.

In a sales call yesterday, Mark LaNeve, vice president, U.S. sales for GM said that he had just gotten off the phone with Saturn dealers, and it was the “most difficult call of his life.” LaNeve also said that inspite of written wind down agreements with dealers that allow them to stay open  unitl the end of next year, GM is dealers close sooner if they want.  Between 300-400 dealers have already done so. “It just makes sense,” LaNeve said.

Ken Zino reported on this story.