After months of negotiations -- and rumors -- General Motors has officially reached an agreement to sell the Hummer brand to China’s Sichuan Tengzhong Heavy Industrial Machinery, according to Nick Richards, spokesman for Hummer. U.S. and Chinese regulatory agencies still need to approve the transaction, and government approval is expected by the end of this year or by early 2010.
"The investment from Tengzhong in Hummer will give the company the capital it needs to create new products and focus on the brand in a manner that it deserves,” Richards told PickupTrucks.com this morning. “We’ll be able to create new vehicles, like the Hummer HX Concept, that will help Hummer meet future environmental and regulatory standards as well as meet the demands and expectations of our customers.”
Tengzhong intends to hold an 80 percent stake in Hummer. Suolang Duoji, a private entrepreneur, will hold the remaining 20 percent stake.
Until the Hummer deal was announced, Tengzhong was a relatively unknown Chinese builder of commercial trucks and industrial machinery with no experience in consumer vehicle manufacturing.
Richards wouldn’t comment on the deal’s value, though recent rumors have said GM is selling Hummer for around $150 million.
It’s been reported that Tengzhong wants Hummer to eventually have a manufacturing plant in China and a dedicated dealer network there, which Hummer doesn’t have today.
According to a joint press release issued by GM and Tengzhong, "[Tengzhong] will acquire the ownership of the Hummer brand, trademark and tradenames, as well as specific IP license rights necessary for the manufacture of Hummer vehicles. The buyer will also assume the existing dealer agreements relating to Hummer's dealership network."
Hummer is expected to keep its headquarters and current manufacturing of the H2, H3 and H3T in the U.S., as well as its current management and engineering teams, including James Taylor, who will remain in his role as Hummer's CEO.
The transaction won’t include Hummer-related military technology or military truck production, which is currently managed by Mishawaka, Ind.-based AM General. GM acquired the rights from AM General to make Hummer trucks.