Indian Car Blog - Carazoo.com

Finally, a sigh of relief for the Hummer fans, and the company, General Motors, is now successful in selling off its all-time favourite model. There were many who thought that Hummer would have a destiny similar to that of Penske-Saturn, which collapsed last week.

But now the future of Hummer seems to be bright with General Motors signing sale agreement with China's Tengzhong. Even though there still are matters that need to settled, such as securing the final financing and passing regulatory approval, at least for the time being, things seem to have settled down.

Formally known as Sichuan Tengzhong Heavy Industrial Machinery Corp., Tengzhong is a Chinese firm. And it has been months since the company is trying to buy out the Hummer. Tengzhong also has plans for the Hummer, it might operate the headquarters of Hummer near Detroit.

Michigan's $20.6 million state tax credit has played a great part in persuading the company to take up such a decision. And the company’s fondness to maintain a strong base in the U.S. market can also be stated as a reason for this.

Tengzong will focus on flex fuel E85 capability, diesel and six-speed transmissions. The diesel models are targeted hugely for the markets outside the U.S. Also, Hummer will become pioneer in offering an alternative fuel powertrain in every model it sells. And this the company will attain with the addition of E85 capability to the 2010 H3 and H3T.

Officially, the deal includes the sale of the HUMMER brand, trademark and tradenames and the intellectual property necessary to manufacture vehicles under license. As per the agreement, the existing dealer network will also be given to Tengzhong.

With a possible one year extension through June 2012, Hummer models will be made under contract with General Motors at the Shreveport and Mishawaka plants through June 2011. But the prospects of the company after 2012, is still shrouded in mystery.

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