General Motor's (GM) military-style SUV Hummer brand met the same winding-down fate as its Saturn and Pontiac brands, when China's Sichuan Tengzhong Heavy Industrial Machines Co's (Tengzhong) over-ambitious plan to acquire the Hummer collapsed after failing to obtain clearance from Chinese regulators.
In a statement yesterday, the Detroit-based carmaker said that Tengzhong was unable to complete the acquisition of Hummer and as a result, it will wind down the Hummer operations.
''One year ago, General Motors announced that we were going to divest Hummer, as part of focusing our efforts on Chevrolet, Buick, GMC and Cadillac going forward. We have since considered a number of possibilities for Hummer along the way, and we are disappointed that the deal with Tengzhong could not be completed," said John Smith, vice president - corporate planning and alliances, GM.
The US auto giant, reeling under a $172-billion debt, emerged from Chapter 11 bankruptcy in July 2009 and has been trying to sell its Opel, Saab, Saturn, and Hummer brands as part of its restructuring. The US government had taken a 60.4 per cent stake in the company by providing a $50-billion aid to the automaker to help it emerge from bankruptcy protection.
GM, which told the bankruptcy court in the US that it expects to get $500 million by selling Hummer, reportedly received an initial expression of interest from two Gulf Arab investors in August 2008. (See: GM looking to Gulf Arab buyers for Hummer: report)
But GM was able to strike a definite sale deal for Hummer nearly a year later in June 2009 with a little known privately-owned Chengdu-based road and construction equipment maker Tengzhong in a deal reported to be worth $150 million. (See: GM's Hummer sold to Chinese company)