GM Dumps Hummer On China

A week or so ago I wrote a post about a Chinese group buying a piece of the NBA’s Cleveland Cavaliers. At that time I said it was in Yogi Berra’s immortal words, deja vous all over again. A country and its citizens hit the big time exporting cheap products all over the world and they go on a spending spree. The Chinese seem to be following in the Japanese footprints.

The news today via the New York Times is that a firm from China is buying the Hummer dog brand from GM.

General Motors has reached a preliminary agreement for the sale of its Hummer brand of large sport utility vehicles and pickup trucks to a machinery company in western China with ambitions to become a carmaker, a person with knowledge of the Chinese government approval process said Tuesday.

The Sichuan Tengzhong Heavy Industrial Machinery Company Ltd., based in Chengdu, concluded the agreement with G.M., said the person, who insisted on anonymity.

Sichuan Tengzhong is a privately owned company, but Tuesday’s deal required preliminary vetting by Beijing officials, who retain the right to veto any effort at an overseas acquisition by a Chinese company and who give special attention to deals over $100 million.

The New York Times said it attempted to call the buyer but the offices were closed so they weren’t able to get any comments about why in the world a company in China wants to build Hummers. I’m stumped. Most people I know that lost temporary control of their senses and bought one of these things sold it within a year. The novelty wore off pretty quickly. Heck, even rich people that buy things just to buy them no longer covet Hummers.

What little market might still remain in the U.S. for these things is going to get flattened over the next few years by “green” regulation. They say they are going to keep building them in this country, so does that mean that they see China as an export market? It might be a novelty item — again for the newly rich — but somehow guiding a Hummer around the choked streets of Peking doesn’t sound like a walk in the park. And what about all of the talk we here about China leading the way in electric automobiles. Is it possible to build a big enough battery to power a Hummer? Who would really want an electric Hummer?

In that prior post I said that we do a pretty good job of selling pigs in a poke to nouveau riche foreign buyers. We were able to foist some pretty expensive real estate and golf courses onto the Japanese for ridiculous prices. It looks like we might not have lost our touch.

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