General Motors Co. has signed a deal to sell its off-road brand Hummer to a Chinese industrial company
GM said last week that it has a definitive agreement with Sichuan Tengzhong Heavy Industrial Machinery Co. for 80% of Hummer. A private investor would buy the remaining stake.
The deal was tentatively disclosed earlier this year.
Under the terms of the deal, GM would continue to build the H3 and the H3T until June 2011 on a contract basis. AM General would assemble the H2 for the Chinese owners for that time period as well. The deals have an option to be extended until June 2012.
Financial terms were not disclosed, but GM would reportedly get US$150 million. It's still subject to closing conditions and regulatory approvals.
James Taylor, the CEO of Hummer, will stay on and lead the company under its new ownership.
“Hummer is a strong global niche brand, and this agreement signifies another important milestone in writing the next chapter for both GM and Hummer,” GM CEO Fritz Henderson said in a statement. “For Hummer, the combination of its knowledgeable leadership team, vehicle-design expertise and the capital financing of Tengzhong portend a successful future.”
The deal could secure around 3000 jobs in the United States.
Hummer said it plans to add FlexFuel capability to the 2010 H3 and H3T and will sell a diesel H3 outside of North America.