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'Cash first' for GM Tengzhong deal
By Cai Hong (chinadaily.com.cn)
Updated: 2009-06-18 13:46 WASHINGTONDC – All bankrupt US carmaker General Motors Corporation needs from the proposed sale of its Hummer brand to Sichuan Tengzhong Heavy Industrial Machinery is money, with experience and expertise in making vehicles not an issue in the deal.
"All I need is cash," Hummer CEO Jim Taylor told China Daily in a recent telephone interview, refusing to say how much the Chinese company is willing to pay for the Hummer brand. With negotiations under way, much has not been set in stone as yet, he said. Still, Taylor expects the Hummer deal between GM and Tengzhong to be finalized by the end of the third quarter.
This means Tengzhong does not need any operational expertise and people, he said. "I'll bring all that to the table," he said. The Chinese company's lack of experience in either international trade or passenger car manufacturing is also not important, he said. While the brand will be owned by a foreign company with no knowledge of making cars, the Hummer CEO said Tengzhong is comfortable with leaving the vehicle-end of operations to him and his crew in the management, engineering, marketing and advertising teams. Tengzhong can merely fund all of these. He also called the deal "a merge of two needs", with Tengzhong getting the automobile business and GM trading brand, people, plants and product for money. Whether the brand is what China needs has been hotly debated in China. GM decided to offload Hummer, which was meant to fill the niche of a high-end, rugged sport utility vehicle that epitomizes the opulence and consumerism of the economic boom. |
