China Buyout Watch: They Might Take The HUMMER After All
The on-again, off-again affair between China and the Gubernator’s favorite toy is on-again. China’s Changfeng rekindled its interest in the HUMMER, Gasgoo reports. “We never quit talks on acquiring the brand,” said Zhengchu Chen, General Manager of Changfeng Motor in an interview with Beijing’s Jinghua newspaper. “But now instead of doing it alone, we decided to form a partnership with AM General to reduce the risk as the global economy falters.” Changfeng and AM General LLC have a plan: the two sides are exploring possibilities of building a joint venture company.
Changfeng showed interest in the brand earlier in the year. Representatives of Changfeng even went to the U.S. on an inspection tour. They came back unimpressed. Reuters report ed that “the Chinese SUV maker backed off after touring Hummer’s U.S. factory, citing limited potential to market the vehicle.” Well… The Chinese SUV market is still vibrant. From January through October 2008, China’s top 10 SUV makers sold more than 300K units. More likely: the price tag for HUMMER has dropped. And a joint venture with a maker of American military vehicles has certain, uh, inherent appeal. Already, there are several HMMWV clones in China, such as the EQ2050 by Dongfeng and the SFQ-2040 by SAC. So….
In 1999, General Motors acquired exclusive ownership of the HUMMER brand name and the marketing rights from AM General. But AMG still continues to manufacture the H1 Hummers for the civilian market. The H2 is GM’s own version of the original Humvee, and it is built on GM’s Suburban frame. The H3 is based on the Colorado pick-up.
An AM General / Changfeng Joint Venture most likely doesn’t need more than the HUMMER brand. AM General is perfectly capable of building the H1 alone.
Changfeng, which has a partnership with Mitsubishi Motors, is a major SUV and pickup truck maker in China market. In January 2007, they announced plans to sell vehicles in the United States by the end of the decade. With a JV with AM General, they might just make it.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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Perhaps Hummer could be resuscitated by getting rid of the H2/H3 and replacing them with good, honest, small off-road cars and trucks reminiscent of the original Wyllis Jeep. Surely China can manage this.
The sooner this dinosaur dies the better ! Funny thing is though, here in northern italy where there is a fair number of them tooling around, they are all driven by incredibly short people !