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Huge military-like American vehicles could soon be careering around Chinese streets after General Motors today announced the sale of its Hummer brand to China's Sichuan Tengzhong.
Sources close to the deal believe Tengzhong paid between $150 million and $250 million for a business that GM first put up for sale a year ago, hoping to raise more than $500 million.
The sale comes a day after GM filed for Chapter 11 bankruptcy protection, to write off debts of $172 billion.
The collapsed US carmaker hopes that the Hummer sell off - which comes as part of the firm's post-bankruptcy plan to focus on fewer brands - will save about 3,000 jobs in the US, where Hummer will remain based.
GM bought the brand from AM General in 1999, but the push for greener vehicles and higher petrol prices has hit the popularity of the gas-guzzling car that was originally based on US armoured Humvees. Global sales tanked by 61% to 5,013 during the first quarter of the year.
Sichuan Tengzhong is a privately-owned oil tanker, truck and trailer maker. The firm's chief executive, Yang Yi, said: “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.”
As part of GM's restructuring, the car marques Pontiac, Saturn and Saab are expected to join Hummer in being sold or, if no buyer is found, wound up. The century-old car giant is also cutting 20,000 US jobs and closing 14 plants.
