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It's been in the works for some time and now it's finally official. According to Reuters, General Motors has signed a definitive agreement to sell its Hummer brand to China's Sichuan Tengzhong Heavy Industrial Machinery, with Tengzhong taking an 80 percent stake and a private investor consuming the rest.
According to GM's statement, it will continue to build both the H2 and the H3 for the new owners until June of 2011. An optional 12-month extension could push production well into 2012. It also noted that the new company is exploring the possibility of a diesel-powered H3 to sell in markets outside the U.S.
"The long-term game plan is to ride the China wave," said Jim Taylor, the GM executive who has helped steer the sale and will remain in Detroit as the new company's chief executive. The deal remains subject to regulatory review in the United States and China. Chinese officials have signaled that the deal would be treated favorably, Taylor said.
Tengzhong, which only produces commercial trucks and industrial equipment, has never entered into consumer vehicles before, but according to Yang Yi, chief executive officer of Tengzhong. "We are excited about some of the initiatives already underway at Hummer that we believe our investment will be able to accelerate, particularly related to the creation of the next generation of more fuel-efficient vehicles to meet not only future regulations but also customer expectations."
