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GM Rejects Eight Offers for Hummer

Reprieve now considered unlikely for GM's macho brand.

by on Mar.10, 2010

A Hummer H3T rolls down the assembly line at GM's Shreveport, LA, assembly line.

The fate of the Hummer brand is now hanging by a slender thread after General Motors Corp. rejected eight separate offers for the brand and ordered employees working on Hummer to wind down the group’s operations.

Until a few weeks ago, it looked like Hummer, one of four brands GM planned to abandon after its emergence from bankruptcy, would find a new home.

The Chinese truck maker, Sichuan Tengzhong Heavy Industrial Machinery Corp., had tendered an offer – but one it couldn’t win final approval for from regulators in Beijing.

On February 24th, GM announced it would begin phasing out Hummer, though it left the door open to finding an alternative buyer, much the same way a white knight emerged to save another one of the four brands, Sweden’s Saab.  According to a memo prepared on March 5, eight offers have since been fielded.

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“Unfortunately there were no qualified or capable candidates. Consequently, we are immediately pursuing the wind-down of the Hummer Brand. In other words there is no more slow winddown it really is wind-down of  Hummer,” according to  a memo signed by Matthew Koch, from the Hummer Deal Execution Team.

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Hummer Sale Falls Through

Chinese buyer may consider alternatives to save deal.

by on Feb.24, 2010

Barring a last-minute reprieve, the Hummer brand may have traversed its last trail.

The proposed sale of General Motors’ Hummer division to a Chinese heavy equipment manufacturer has apparently collapsed, though the proposed buyer, Sichuan Tengzhong Heavy Industrial Machinery Corp., is reportedly looking at alternatives that could overcome the apparent opposition of Beijing regulators.

Barring some unexpected reprieve, however, GM said that it is ready to start an orderly shutdown of the once-popular Hummer operation, one of four brands the company decided to close as sell as part of last year’s bankruptcy reorganization.

“GM will now work closely with HUMMER employees, dealers and suppliers to wind down the business in an orderly and responsible manner,” said John Smith, the U.S. maker’s director of corporate planning and alliances.

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GM and Tengzhong reached a preliminary agreement for the sale of Hummer last June.  The proposed deal came as a surprise for a number of reasons.  Some analysts had wondered whether any buyer would surface considering the sharp slump in sales of the brand’s products following the record run-up in oil prices the previous year.

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The Top Ten Auto Stories of 2009

Bankruptcies, bailouts, recalls, oh what a bad year it was!

by on Dec.30, 2009

Brother, can you spare a dime? The jet-setting Detroit Three at hearings: left, fired GM CEO Rick Wagoner, ex Chrysler CEO Bob Nardelli, middle, Ford's surviving CEO Alan Mulally, right.

Every December, a group of auto scribes gathers together to share some good cheer and see how we did at predicting the events of the unfolding year. To be honest, even the best of the group failed to come close to calling the big stories of 2009.

No surprise, really, when you consider the strange twists and turns the auto industry has taken during the last 12 months.  Even the best fiction writers would have had trouble scripting this plot.

Sure, there were signs that the auto industry was slumping, and that the Detroit’s Three were in trouble, but having both General Motors and Chrysler go bankrupt?  And the U.S. government become majority owner of GM, with Italian automaker Fiat controlling Chrysler?  And what about Toyota?  Twelve months ago, most of us were writing about the fact that the giant Japanese automaker seemed certain to become the world’s largest automaker, finally overtaking troubled GM.  So, who could have begun to suspect all the problems that would follow for Toyota in 2009?  And what about the unexpected rise of the Chinese?

Top Ten!

But I’m getting ahead of myself.  The fact is, there were so many big stories in 2009 it may be impossible to come up with a fair, accurate and complete list of the 10 Top Auto Stories that everyone will agree on.  But I’ll try.

And TheDetroitBureau.com would like to encourage readers to come up with the stories they would add to the list.  Just go to the Comments section at the end of this story.

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GM and Tengzhong Agree on Sale of Hummer

GM’s Shreveport plant remains open until at least June of 2011.

by on Oct.09, 2009

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GM's Shreveport assembly plant will contract build the H3 and H3T models until 2011 or 2012.

General Motors (GM) and Sichuan Tengzhong Heavy Industrial Machinery Co., Ltd (Tengzhong) have just announced that the companies have entered into a definitive agreement that will allow Tengzhong to acquire GM’s premium all-terrain Hummer brand.

Under the terms of the definitive agreement, the buyer will acquire the ownership of the Hummer brand, trademark and tradenames, as well as specific intellectual property license rights necessary for the manufacture of Hummer vehicles. The buyer will also assume the existing dealer agreements relating to Hummer’s dealership network.

Tengzhong will purchase Hummer through an investment entity, in which it will hold an 80% share. Mr. Suolang Duoji, a private entrepreneur with holdings that include the Hong Kong-listed nardite producer Lumena, will have the remaining 20%.

Financial terms of the agreement were not disclosed.

“This transaction marks an exciting step for both Tengzhong and Hummer, as we invest in a business that has significant opportunity in the U.S. and around the globe,” said 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.”

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Q&A: Hummer’s Jim Taylor

How do you translate, “The brand environmentalists love to hate,” into Chinese?

by on Jun.02, 2009

Hummer at the crossorads.  GM has signed a preliminary deal with a Chinese maker which hopes to take over the controversial SUV brand later this year.

Hummer at the crossroads: GM has signed a deal with Chinese maker Tengzhong. It hopes to take over the controversial SUV brand later this year.

Life — and business — can take some strange turns.  Jim Taylor is a great example.  He was trained as an engineer, yet somehow wound up taking over General Motors’ flagship Cadillac division and, as general manager, leading it through its “renaissance” project, with the launch of products like the well-acclaimed CTS sedan.

But a year ago, Taylor was unexpectedly reassigned to GM’s Hummer brand, a division that serves as public enemy number one for environmentalists.  Taylor’s primary job was to oversee the spinoff of the once-popular brand, one of the four divisions GM will shed as part of his Chapter 11 reorganization.

Early Tuesday morning, the automaker announced it had found a buyer.  Initial intentions to keep details secret didn’t last long, as the folks at Sichuan Tengzhong Heavy Industrial Machinery Co., Ltd, in Chengdu, China, were quick to start crowing about their new acquisition.  From one of the symbols of American prowess to the latest Chinese toy, Jim Taylor talked with TheDetroitBureau.com’s Bureau Chief Paul A. Eisenstein about the sale and what’s to come at Hummer, which he has agreed to stay on with when the sale is formalized, in the coming months.

Subscribe to TheDetroitBureau.comTDB: Hummer’s sale surprised some folks, who thought the brand was damaged beyond repair.

Taylor: The first thing investors look at it is cash: does it make money?  We’re peddling an asset capable of turning a profit.  We had to find someone willing to make a serious investment.  This is not for the faint-of-heart.  This is an expensive date and goes on for a long time.  In the auto industry, as we’ve all seen, you can chew through a lot of cash, fast, so we were looking for a select group of investors with very deep pockets and a long-term vision. (more…)

Hummer Sold; Production to Return to U.S.

Buyer yet to be named; Taylor to stay with Hummer after sale.

by on Jun.02, 2009

GM has confirmed it has a buyer for Hummer but is withholding its name. The automaker will bring back H3 production from S. Africa and concentrate it in Shreveport, LA.

GM confirms it has an unamed Hummer buyer. The automaker will bring back H3 production from South Africa to Shreveport, Louisiana.

General Motors has officially reached an agreement to sell its Hummer off-road brand to a yet-to-be named buyer. The term sheet signing was announced by GM in a press release early Tuesday.

The move is expected to be a boon to workers at a GM plant in Shreveport, Louisiana, who will be picking up production work currently handled at a factory in South Africa.

“GM has signed a memorandum-of-understanding with an investor,” Hummer spokesman Nick Richards told our associates at PickupTrucks.com. “Both parties have agreed to the basic terms [of the purchase] but the financial details and buyer’s name are not being released at this time. That’s expected to be announced some time in the near future.”

Richards said the buyer meets all of GM’s criteria to purchase and operate the Hummer brand’s civilian truck production: They have a proven track record in international business; they know the Hummer brand can perform better globally; and they have a long-term development plan and are willing to invest in future products. (more…)