GM said its Hummer brand, with models like the 2009 H2, is worth $500 million or less. The sale would keep the headquarters in America. (GM)
General Motors Corp., a day after filing Chapter 11 bankruptcy, has a tentative deal to sell its Hummer brand to Chinese-based Sichuan Tengzhong Heavy Industrial Machinery Co., Ltd., the automaker said Tuesday.
GM did not reveal the sale price -- though in a bankruptcy filing, GM said the brand is worth $500 million or less. The company said the deal, which includes the brand's senior management and operational team, could close by the end of the third quarter and would protect more than 3,000 manufacturing, engineering and dealership jobs across the country.
Tengzhong also is expected to sign a long-term contract for assembly and a material supply agreement with GM.
Privately owned Tengzhong, which is based in the Chinese province of Sichuan, is a domestic manufacturer of road, construction and energy industry equipment.
"We will be investing in the Hummer brand and its research and development capabilities, which will allow Hummer to better meet demand for new products such as more fuel-efficient vehicles in the U.S.," Tengzhong CEO Yang Yi said in a statement.
The Hummer headquarters and operations will remain in the United States, and executives plan to expand the dealer network globally -- including in new and underserved Chinese markets.
"With Tengzhong's investment and strong support, we will be able to make our visions a reality," Hummer CEO James Taylor said in a statement.
GM will continue to provide vehicles on a contract basis for awhile, meaning workers at GM's Shreveport Assembly plant in Louisiana would keep assembling the H3 and H3T at least through next year.
"Hummer is a strong brand," said Troy Clarke, president of GM North America, in a statement. "I'm confident that Hummer will thrive globally under its new ownership. And for GM, this sale continues to accelerate the reinvention of GM."
Shedding Hummer is part of GM's overall restructuring plan, which also involves selling or phasing out the Saturn, Saab and Pontiac brands.
GM acquired the brawny Hummer brand in 1999 from AM General Corp. It did not acquire the military building component of the company.