Hummer Goes to Chinese Machinery Company

badguy2000

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well, after working hard and finishing a consolidated and decent auto industry chain, chinese now has made all preparation to take the postion of USA and Japan.

the only thing that CHinese auto industy is short of is brand and promotion.

Obvioulsy, the collapse of GM provide Chinese auto industry a chance to improve its brand and promotion.:blum3:
 
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well, after working hard and finishing a consolidated and decent auto industry chain, chinese now has made all preparation to take the postion of USA and Japan.

the only thing that CHinese auto industy is short of is brand and promotion.

Obvioulsy, the collapse of GM provide Chinese auto industry a chance to improve its brand and promotion.:blum3:
GM,chrysler and Ford have all collapsed, but the japanese and Europeans are still in the game
 

badguy2000

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GM,chrysler and Ford have all collapsed, but the japanese and Europeans are still in the game
if measued by the sale of auto industry ,Chinese can defeat Japanese and European easily in one decades.

:blum3:
 

S.A.T.A

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Chinese machine maker's Hummer buy raises eyebrows

By Fang Yan and Edmund Klamann

SHANGHAI (Reuters) - A little-known player in China's heavy machinery industry emerged from nowhere to agree to buy General Motor's GMGMQ.N Hummer brand, raising eyebrows among peers who question whether it can turn around the U.S. auto maker.

The tentative deal with privately-held Sichuan Tengzhong Heavy Industrial Machinery Co, announced on Tuesday, just one day after GM's bankruptcy filing, surprised Chinese industry executives and analysts.

"Who is Tengzhong? Why does it want to buy Hummer? What are they going to do with it?" asked a senior executive with Hunan Changfeng Motor Co (600991.SS), a sport utility vehicle specialist based in Hunan province, next to Tengzhong's home turf in Sichuan province.

Changfeng, which makes low- and mid-range SUVs, expressed initial interest in Hummer last year but did not follow through after a tour of its U.S. plant.

"We want to tap the higher-end segment and we thought Hummer could be an opportunity. We were impressed with the plants and the facilities, but we didn't think we could keep it up and running and -- most of all -- turn it around," said the Changfeng executive, who asked not to be identified because of the sensitive nature of the comments.

Tengzhong, formed in 2005 through several mergers, makes special-use vehicles such as dump trucks and fuel tankers, as well as construction machinery, energy equipment, and structural components for highways and bridges.

It has 4,800 employees, according to its website, about the same as Changfeng. The site does not disclose any financial data.

LACK OF EXPERIENCE

Analysts said Chinese companies, with little success in overseas acquisitions, lack the experience and expertise to take over foreign auto brands that their owners have abandoned.

SAIC Motor Corp (600104.SS), China's largest automaker and a partner of GM and Volkswagen AG (VOWG.DE), was badly burned by its investment in South Korea's Ssangyong Motors (003620.KS), which filed for bankruptcy protection.

Its acquisition of Britain's MG-Rover succeeded mainly by providing technology to the in-house development of a new brand, while most production was moved to China from the UK.

Tengzhong said Hummer's operations would stay in the United States and would be run by existing management after the takeover. It pledged to invest in new product development, including more fuel-efficient vehicles, and expand its dealer network globally.

"If it were a big Chinese state auto group like SAIC Motor, it could be a different story, but I doubt that Tengzhong, a company which popped up from nowhere, is big enough to swallow
Hummer," said Zhang Xin, an analyst with Guotai Junan Securities.

A representative for Tengzhong said the purchase, expected to be closed in the third quarter, would be funded from Tengzhong's internal resources and bank loans, although she gave no details.

She declined to comment on whether Tengzhong had Chinese government backing for the deal or on the chances of winning approval from U.S. regulators, who in 2005 vetoed the sale of Unocal to China's offshore oil specialist CNOOC

Hummers were originally multipurpose off-road military vehicles. After GM bought the brand from AM General in 1999, AM General continued to make the Humvee for the U.S. military.

The Tengzhong representative said the company currently was not a supplier to the Chinese military, although a statement on the company's website said it was certified by the government as a qualified manufacturer of military armaments in March.

"The certificate is of great significance for Tengzhong Heavy Industrial, as it has laid a solid foundation for the firm's next move to enter into production of military equipment," it said.

(Editing by Rupert Winchester)
 

badguy2000

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Chinese machine maker's Hummer buy raises eyebrows

By Fang Yan and Edmund Klamann

SHANGHAI (Reuters) - A little-known player in China's heavy machinery industry emerged from nowhere to agree to buy General Motor's GMGMQ.N Hummer brand, raising eyebrows among peers who question whether it can turn around the U.S. auto maker.

The tentative deal with privately-held Sichuan Tengzhong Heavy Industrial Machinery Co, announced on Tuesday, just one day after GM's bankruptcy filing, surprised Chinese industry executives and analysts.

"Who is Tengzhong? Why does it want to buy Hummer? What are they going to do with it?" asked a senior executive with Hunan Changfeng Motor Co (600991.SS), a sport utility vehicle specialist based in Hunan province, next to Tengzhong's home turf in Sichuan province.

Changfeng, which makes low- and mid-range SUVs, expressed initial interest in Hummer last year but did not follow through after a tour of its U.S. plant.

"We want to tap the higher-end segment and we thought Hummer could be an opportunity. We were impressed with the plants and the facilities, but we didn't think we could keep it up and running and -- most of all -- turn it around," said the Changfeng executive, who asked not to be identified because of the sensitive nature of the comments.

Tengzhong, formed in 2005 through several mergers, makes special-use vehicles such as dump trucks and fuel tankers, as well as construction machinery, energy equipment, and structural components for highways and bridges.

It has 4,800 employees, according to its website, about the same as Changfeng. The site does not disclose any financial data.

LACK OF EXPERIENCE

Analysts said Chinese companies, with little success in overseas acquisitions, lack the experience and expertise to take over foreign auto brands that their owners have abandoned.

SAIC Motor Corp (600104.SS), China's largest automaker and a partner of GM and Volkswagen AG (VOWG.DE), was badly burned by its investment in South Korea's Ssangyong Motors (003620.KS), which filed for bankruptcy protection.

Its acquisition of Britain's MG-Rover succeeded mainly by providing technology to the in-house development of a new brand, while most production was moved to China from the UK.

Tengzhong said Hummer's operations would stay in the United States and would be run by existing management after the takeover. It pledged to invest in new product development, including more fuel-efficient vehicles, and expand its dealer network globally.

"If it were a big Chinese state auto group like SAIC Motor, it could be a different story, but I doubt that Tengzhong, a company which popped up from nowhere, is big enough to swallow
Hummer," said Zhang Xin, an analyst with Guotai Junan Securities.

A representative for Tengzhong said the purchase, expected to be closed in the third quarter, would be funded from Tengzhong's internal resources and bank loans, although she gave no details.

She declined to comment on whether Tengzhong had Chinese government backing for the deal or on the chances of winning approval from U.S. regulators, who in 2005 vetoed the sale of Unocal to China's offshore oil specialist CNOOC

Hummers were originally multipurpose off-road military vehicles. After GM bought the brand from AM General in 1999, AM General continued to make the Humvee for the U.S. military.

The Tengzhong representative said the company currently was not a supplier to the Chinese military, although a statement on the company's website said it was certified by the government as a qualified manufacturer of military armaments in March.

"The certificate is of great significance for Tengzhong Heavy Industrial, as it has laid a solid foundation for the firm's next move to enter into production of military equipment," it said.

(Editing by Rupert Winchester)

the buyer of Hammer is a subsidiary of a big chinese defence-industry company.
 

Energon

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Chinese manufacturing has certainly proved itself at all scales through global competition, so I don't think mass producing Hummers is going to be that big a deal for them. The biggest challenge will be to convince potential consumers to buy this product. Initially there may be some impulse purchases in China on account of the symbolism of it all, but eventually the cost of ownership issues will catch up just like it did the American consumer base.
 

Daredevil

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China's domestic consumption is dismal and their ability to buy Hummer which, by the way, is a gas guzzler and makes even more unattractive option to an average chinese. Hummer future will mostly depend on the sales from US region as most of the world is moving towards more economic and less polluting (green) cars and away from the highly polluting and gas guzzling utility vehicles like Hummer.
 

p2prada

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Hummer is very difficult to drive. You get backaches after an hour. Hard steering with really big wheels. oof.

Anyways, if the Chinese company can make the purchase, they will have a hard time selling it. What is the automobile scene in China? Will people buy gas guzzlers?


Looks like I got my answer.
China's domestic consumption is dismal and their ability to buy Hummer which, by the way, is a gas guzzler and makes even more unattractive option to an average chinese. Hummer future will mostly depend on the sales from US region as most of the world is moving towards more economic and less polluting (green) cars and away from the highly polluting and gas guzzling utility vehicles like Hummer.
:)
 

F-14

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think about the Fall out it will have on Hummers Former Home the US Of A
 

Energon

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China's domestic consumption is dismal and their ability to buy Hummer which, by the way, is a gas guzzler and makes even more unattractive option to an average chinese. Hummer future will mostly depend on the sales from US region as most of the world is moving towards more economic and less polluting (green) cars and away from the highly polluting and gas guzzling utility vehicles like Hummer.
I wouldn't hold my breath for the US consumer base to rise. Let's be honest, the Hummer was primarily a fad, started by Arnold Schwarzenegger, who has since taken to driving hybrids.

GM tried its hand at the more "civilian friendly" H2 and H3 models which btw aren't based on the original Hummer (H1) but rather on their other more popular pre existing truck and pick-ups frames from the GM lineup. Ironically as it turns out after the initial rounds of impulse purchases the customers preferred the original chassis models like the Yukon/Denali and the Avalanche, which GM has no intention of relinquishing.

The interesting thing about the GM Hummer is the primary intellectual property right is on the outward appearance of the car- the two round lights and the grill in the middle. What chassis and engine go with it is in some ways a secondary matter. You can essentially buy a Hummer golf cart...


The problem with these cars have always been the prohibitive cost of ownership which had made them universally undesirable. Until the contractual obligation to keep the US facilities runs out in 2010 the price of the cars is unlikely to drop. But even if/when the entire production lines are moved to China and the price per unit plummets the cost of ownership is unlikely to change.

As things stand right now the highest selling 'full sized' pick up and trucks are all established American products like the Ford 150 and Chevy Silverado while the Japanese seem to have the run on the mid sized variant market with the likes of the Toyota Tundra and the Honda Ridgeline.
China is going to have to create a local consumption base or expand markets elsewhere in the world if they want to turn this into a profit making venture. Now it is entirely possible for the Chinese military to book massive orders and keep the company afloat.
 

kuku

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How big is the domestic market of PRC?

I guess at the pace its economy has been growing it might be the biggest market by 2020.

This is a stupid buy though, the business people who did this might suffer a lot, the era of big SUVs could be starting its end, right now.
 

1.44

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Even the US army has realised the short coming of the Hummer.it's going to be replaced soon anyway
 

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http://www.nytimes.com/2009/06/07/weekinreview/07goodman.html?ref=world

Even in a world mostly done being amazed by the ironies of globalization, last week managed to produce something fresh and previously unfathomable: General Motors, newly bankrupt and struggling to raise cash, agreed to sell its Hummer division to a company from China.

Yes, that Hummer, maker of the famously gas-guzzling behemoths whose menacing width and armor trace their provenance to the American military, is now set to become the property of Sichuan Tengzhong Heavy Industrial Machinery Company, in a land officially still called the People’s Republic of China.

It might seem incongruous, this plaything for the unabashed American road warrior shifting to a country where the bicycle once ruled and collectivism was an organizing principle. (What next? Harley-Davidson snapped up by the Vietnamese?) But that’s just until you contemplate the realities of modern China, and the nouveau riche in the growing suburbs, setting down lawn furniture inside gated complexes of villas, shopping at big-box stores and driving luxury cars. China seems intent on nurturing the very sorts of landscapes and consumer attitudes that produced the Hummer.

More than a merely economic event — the latest sign of China’s rise and American struggles — the deal is a cultural moment. It seems no accident that a Chinese company is taking possession of Hummer. China has come to embrace many of the attributes and modes of consumption that Americans may reflexively consider their own, complete with the sprawl and tangle of highways familiar to any resident of Los Angeles or Atlanta.

As China has cast off its ideological past and aggressively modernized its cities, it might reasonably have been expected to look to Europe or Japan for models of urban planning. Like Japan — home to one of the most sophisticated rail networks on earth — China is densely populated and dependent on imported oil. As is true in Europe, China’s major cities are surrounded by productive agricultural lands, making tightly clustered growth seem prudent.

Instead, in a choice familiar to Americans, China has put the automobile at the center of contemporary life. China has torn down older buildings in every major city to make way for more vehicles. It has erected an impressive network of highways crisscrossing the vast country. Air quality and energy efficiency have been outweighed by reverence for the car.

This has not happened randomly. In recent times, China’s leaders have unleashed enormous quantities of state finance to seed auto ventures in every province, spurring industries that have grown along with the ubiquity of the car. Petrochemicals, steel, glass-making and rubber have all expanded to feed auto-making. Tourism and retail shopping have increased as more Chinese take possession of steering wheels.

Along the way, many Chinese aspirations have come to focus on car ownership. In a country where so many people look back with bitterness on the regimented days of Maoism, and where public transportation still involves packing into belching buses and gruesomely crowded trains, the car has become a vessel for Chinese dreams.

“Why do you want a car?” I asked a young professional couple shopping at a car lot outside Beijing in 2002. The question elicited an irritated glare from the woman, as if I were condescending. “Same reason you want a car,” she said. “We want what you want.”

She did not mean merely the ability to go where she pleased, but also the geography the car enables — the villas with their backyards and modern conveniences; the superstores selling microwave-ready food; the new golf courses.

Asked about the atrocious smog blanketing Beijing and the traffic jams that made driving there a threat to mental health, she shrugged. Anyway, the car takes a growing slice of wealthy urbanites into the countryside for the pure pleasure of it — this, too, once unthinkable in a nation that remembers how city dwellers were forcibly dispatched to the hinterlands to slop pigs during the Cultural Revolution.

As driving has evolved from a mere way to get around to a mode of life, sales of passenger cars in China have grown by 20 percent to 30 percent per year since 2005. In January, for the first time ever, China’s monthly vehicle sales exceeded those in the United States.

Still, it would be wrong, if tempting, to view China as some sort of time capsule of 1950s American suburbia, that age before the vernacular came to include “climate change” and “non-renewable resource.” China is moving to impose fuel efficiency standards tougher than those in the United States while developing hybrid cars. Most car owners favor cheaper, smaller models.

But much as everywhere else, the auto has become a status symbol in China, and in ways that collide with the country’s history as a paragon of anti-imperialism: Cadillacs, that icon of American capitalist success, are now made on Chinese soil along with Audis and Buicks. In the new Chinese social divide, the middle class hews to economical vehicles with tiny engines, while the wealthy fuss with automatic climate control in their luxury sedans.

So it actually seems fitting that Hummer will be a Chinese brand. A vehicle that makes sense only as a pastime, with its miserable gas mileage, the Hummer has become an object increasingly shunned in the United States as a sign of wasteful decadence (not to mention something that most Americans can no longer afford). China, primed to consume and long since shorn of its collectively imposed thrift, will take a crack at extracting profit by selling the hulking beasts.
 

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