Hummer sale collapses; GM will wind down the brand
China’s Sichuan Tengzhong unable to get approval
Automotive News | February 24, 2010 – 2:56 pm EST
UPDATED: 2/24/10 3:59 p.m. ET
|DETROIT — General Motors Co. will wind down its Hummer brand after a proposed sale to China’s Sichuan Tengzhong Heavy Industrial Machines Co. Ltd. fell through.
Tengzhong “was unable to complete the acquisition,” GM said today in a statement. The Chinese company failed to win government approval of the sale, a source familiar with the negotiations said.
GM will honor warranties, provide spare parts and will support service for Hummers worldwide, the automaker said. GM has 153 U.S. Hummer dealers, spokeswoman Ryndee Carney said in an e-mail.
The failed deal likely seals the fate of the last of GM’s four unwanted U.S. brands. GM is winding down Saturn after its sale fell through in September. Pontiac is also being phased out. GM yesterday completed the sale of Saab to Dutch niche carmaker Spyker Cars NV.
GM is open to receiving other bids for Hummer as it winds down the brand, the source said. The sale of Saab arose out of a similar situation: Spyker entered a bid after a proposed sale of Saab to Sweden’s Koenigsegg Group AB fell through in November. The chances of resurrecting Hummer are viewed as slimmer than they were at Saab, the source said.
GM put Hummer up for sale in 2008, before the global financial crisis that dragged the automaker into bankruptcy.
In June of last year, GM said it expected to sell Hummer to the Chinese heavy machinery maker, which has no experience in the auto industry. Hummer’s 67 percent sales decline last year was the steepest of any volume brand in the United States.
GM bought the brand in December 1999 from AM General, which has also continued to make versions for the armed forces.
Hummer entered the civilian market in 1992. Non-government Hummer sales were averaging between 800 and 1,000 units annually when GM bought the brand.
Hummer’s U.S. sales peaked at 71,524 in 2006, before demand was choked by gasoline prices that soared above $4 per gallon in 2008. Sales last year dwindled to 9,046.