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GM Sells Hummer to Private Chinese Company

By Bob Blandeburgo
Associate Editor
Money Morning

General Motors Corp. (NYSE: GM) has sold its troubled Hummer division to privately held, China-based Sichuan Tengzhong Heavy Industrial Machinery Company. Terms of the deal were not disclosed.

The sale will save roughly 3,000 jobs in the United States, including those at 153 domestic dealerships.

“If you think about the qualities we’d want in a new owner for the brand, this buyer really met all the criteria,” Hummer spokesman Nick Richards said without identifying Sichuan Tengzhong. “They’ve got a proven track record in international business, and they’ve got a long-term vision for the brand. They’ve got the capital to invest in more efficient vehicles, which is what’s necessary to grow the brand.”

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GM continues to shop Saturn and Saab, Chief Financial Officer Ray Young said in a conference call, noting that 16 parties are interested in Saturn.

“And we’re discussing product continuation agreements with these prospective purchasers,” he said.

The company’s Pontiac brand will be discontinued next year.

As for investment opportunities, Young said new shares will be available in the first or second quarter of next year at the earliest.

“In terms of the timing of that, ‘09 would be impossible because we’re just starting up the new General Motors,” he said. “There’s going to be a lot of accounting issues that we’re going to work through in order to get the books of new GM set up.”

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This entry was posted on Tuesday, June 2nd, 2009 at 10:12 pm and is filed under Top News. You can follow any responses to this entry through the RSS 2.0 feed. Due to the amount of comments we receive Money Morning will not be able to respond to all questions. If you have not already registered to leave a comment, once doing so you will receive Money Morning's Daily Email.

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  1. Comment by KCB Gupta on 4 June 2009:

    Hummar is an iconic brand. We do not know whether the US Administration will clear the deal without some riders, due to security concerns. Hummer vehicles can be used by the armed forces with telling effect. Presence of Chinese in such vital end use possibilities has to be looked seriously, irrespective of the saving of jobs and relief to beleagured GM.

  2. Pingback by GM Sells Saturn Unit to Penske as Part of Bankruptcy Plan on 8 June 2009:

    [...] earlier this week announced that it plans to sell Hummer to China’s Sichuan Tengzhong Heavy Industrial Machinery Co., is offloading its European Opel operations to Magna International Inc. (NYSE: MGA), and is [...]

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