GM has entered an agreement to sell off its Hummer line to an unnamed buyer at an unnamed price. According to the agreement, the oversized SUV will live on in the hands of its new owner, and GM factories will keep pumping out Hummers for the next two years.
We’re curious as to who would want to buy this line. Sales fell off a cliff, and we don’t see a big recovery.
UPDATE: As a commenter points out, Zero Hedge is putting the price at $100-200 million, with out a source. “That will plug their hole…from 10-15 hours of operation.” The Journal puts the price at sub $500 million, based on previous bids.
DETROIT (Reuters) – General Motors said on Tuesday that it had entered into a memorandum of understanding to sell its Hummer brand, but didn’t name the buyer or say how much money it would get for the all-SUV line.
GM, which filed for bankruptcy on Monday, said the sale was is set to close by the third quarter of this year and should secure more than 3,000 jobs in manufacturing, engineering and at Hummer dealerships around the United States.
The transaction includes plans by the unnamed investor to aggressively fund future Hummer product programs, according to the automaker.
Under the proposed deal, Hummer will continue to contract vehicle manufacturing and business services from GM during a defined transitional time period.
Also, GM’s Shreveport Assembly plant would continue to contract assemble the H3 and H3T through at least 2010.
GM did not reveal other details of the sale.
The automaker has been reviewing options for the past year for the gas-guzzling brand.
GM sold about 27,485 Hummers in the United States in 2008, down 51 per cent from a year earlier. Hummer SUVs starts at roughly $31,000 and go up to nearly $72,000 with options.
In early April, sources told Reuters that three bidders were in the running for Hummer, and that none of the bidders are automakers.
One bidder is from the United States and the other two are from overseas, the sources had said, adding that the bidders include private equity and wealthy individuals.
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