Despite how badly GM wants to dump the Hummer, a looming global recession (and of course high oil prices) may be putting the kibosh on that plan.
General Motors (GM) had been in preliminary talks with automakers across Asia (including those in India and Russia) regarding the sale of its Hummer division. But now Chinese SUV maker Hunan Changfeng has broken off talks with GM and no longer has any interest in purchasing the gas-guzzler. Their remarks do not bode well for GM.
According to a Reuters source, Changfeng chose not to proceed because “the Hummer is way too expensive for the Chinese military and demand from civilian buyers is not big enough to justify a purchase, especially with oil prices running near an all-time high.” The market leader in the Chinese auto industry, SAIC Motors, and the No. 3 player, Dongfeng, also have said they have little interest in the Hummer.
Considering that China is about the only global market left still purchasing Hummers, these develoments are not encouraging for GM’s planned sale. Now it’s up to a Russian billionaire, an Indian automaker (Mahindra and Mahindra) or a Turkish private equity fund to come through.
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