Chinese Purchase of Hummer Won't Affect Dealer Network

Hummer Now that the purchase of Hummer by Tengzhong appears to be all but in the bag, an executive for the Chinese heavy machinery company has said that it will maintain Hummer’s network of auto dealerships throughout the U.S.

The deal appeared to be an iffy proposition earlier this summer. However, the Chinese commerce ministry seems to have dialed down its skepticism, and the opposition on state-run media has evaporated, as well.

Tengzhong has said it expects to close the deal this fall, and analysts estimate the final price as somewhere between $150 million and $200 million. This is well below the $500 million GM wanted for the brand. Hummer sold 799 vehicles last month compared to 1,877 purchased during the same period in 2008 while gas prices were at record levels.

Barring any last-minute surprises, it would appear that Hummer will become Chinese-owned well before 2010.

Tengzhong Deal Won’t Affect Hummer Sales Network: Exec (Reuters)

By Stephen Markley | August 25, 2009 | Comments (5)



I would like to see how things turn out in the future. As of now, I would lean on the skeptical side if someone were to say Tengzhong's ownership will help Hummer in the long run.


In the long run, I don't think the Hummer will survive. BUT, what this will give the Chinese is an instant dealership network to begin importing and servicing their smaller and more efficient cars (and maybe even their new electric cars.) Assuming, of course, these cars can meet federal regulations.


Maybe the Chinese will bring in slat-grilled minicars with big tires and jacked up suspensions? HUMMER H4,H5,H6 here we come...


Just watch, GM will end up buying Hummer back when they once again want a piece of the off road market that has been dominated by Jeep and Toyota for so long. It will probably be easier than competing with the division they started.

What's so backwards about this is that we should be selling Hummers (and whatever else) to the Chinese (and rest of the world), not the other way around.


Where have you been? Don't you know the way it works is that we buy stuff from China, then they lend that money back to us with interest so that we can buy more of their stuff? Don't break the perfect system! :)

So, Tengzhong is paying $15,000-$20,000 per vehicle per year (assuming ~10,000 vehicles sold per year) for Hummer? The profit margin on those things is quite high as I recall. They could easily be making a 50% return on their investment, even at Hummer's low rate of sales.
an, wish I my government would lend me hundreds of millions of dollars to buy up and start up businesses...

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