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Hummer's Chinese buyer says no plan for China plant

2009-06-04 08:18 BJT

Special Report: GM Reshuffles amid Auto Crisis |

by Xinhua writer Yang Bo

CHENGDU, June 3 (Xinhua) -- Sichuan Tengzhong Heavy Industrial Machinery Co., Ltd. (Tengzhong), a private Chinese firm who has struck a preliminary deal with General Motors Corp. (GM) for the premium SUV brand Hummer, said Wednesday it has no plan to manufacture Hummer in a Chinese plant.

"Rather than setting up a plant in China, Tengzhong will use the current facilities including their employees in the United States," said Zhao Xiaolu, spokesman for the ongoing transaction for Tengzhong, a leading manufacturer of road, construction and energy industry equipment based in southwest China's Sichuan Province,

Zhao works for the Brunswick Group, which is handling the public relations matters for the Tengzhong deal. Tengzhong's managers were not available for comment on the transaction, which was disclosed Tuesday, a day after GM filed Chapter 11 bankruptcy.

According to an overall restructuring plan, the U.S. based automaker GM will shed off its none-core assets including Hummer, Saturn, Saab and Pontiac.

The preliminary deal allows Tengzhong to keep the management and operational team along with the Hummer brand, and secure more than 3,000 jobs in the United States. The Chinese buyer will also assume existing dealer agreements relating to Hummer's dealership network.

Tengzhong CEO Yang Yi said in a statement Tuesday that the company will "allow Hummer to innovate under the leadership and continuity of its current management team".

James Taylor, Hummer chief executive officer, went to Chengdu City and Deyang City, Tengzhong's current base and new base under construction, to discuss project cooperation with local officials in March.

"This transaction, if successful," said Taylor in a statement Tuesday," will allow us to embark on a more aggressive global expansion, ensuring a successful future with our new partners."