Do you feel that? That’s the taste of irony. General Motors, one of the biggest car makers in the world, has officially announced, through the voice of its CEO, Fritz Henderson, that an American symbol of capitalism and over-indulgence, Hummer, will be sold to none other than Chinese corporation Sichuan Tengzhong, a leading company in the communist country.
The announcement was made at the end of last week, but we were sort of waiting for Henderson to pop out with a party hat and say it was all a joke. But it isn’t a joke, as Sichuan Tengzhong will purchase the american brand and all of its intellectual property through an investment entity in which it will hold 80% of the stock, with the other 20$ going to a private investor from Hong Kong, Soulang Duoji.
“Hummer is a strong global niche brand and this agreement signifies another important milestone in writing the next chapter for both GM and Hummer,” said Fritz Henderson, GM President and CEO 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.”
It is rumored, but unconfirmed, that the whole deal cost the Chinese conglomerate about $150 million, and it covers both all of the license rights to manufacture the models in the Hummer range but also the right to keep on using the GM plants to make the models up until 2011.
“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.”
Well, what do you think about this rather shocking turn of events for the American brand? Is this new Chinese ownership for the best of Hummer or will you just wait and see what plans the new bosses have for the brand? Don’t be shy to drop a comment below.