GM Now Says Sale of Hummer Brand a Strong Possibility

By Brendan Moore

06.16.2008

General Motors has revised its previous statements regarding Hummer’s future, with the head of GM’s premium sales channel telling dealers last week that an outright sale of the Hummer division to another company is a strong option.

On June 3, GM announced that all options were on the table concerning Hummer; and those options included a revamping of the brand, making the brand a low-volume luxury brand, shutting it down completely, or, selling it. GM’s statement on June 3 presented all of these options as equal in terms of their odds of occurring.

From what Mark McNabb, 47, GM’s new vice president of the premium channel (Cadillac-Hummer-Saab), has told dealers as of last week, apparently several potential buyers have stepped forward since GM’s announcement on the 3rd, and GM now considers a quick sale to be a very strong “Plan A” for Hummer.

The most prevalent rumor surrounding potential buyers for Hummer is that Tata, the Indian auto company and the new owner of Land Rover, is in the lead in terms of potential suitors. McNabb, however, told dealers last week that GM has had no discussions with Tata about Hummer.

McNabb did say, however, that “several global companies” have expressed considerable interest in purchasing Hummer. Besides Tata, one has to conjecture that at least one or two Chinese automakers are probably interested, perhaps (but probably not) one of the Russian firms, and maybe one or two European car companies. Just as with the recent sale of Jaguar and Land Rover, one has to assume that there are also investment groups interested in purchasing Hummer, and through that purchase, entering the car business.


Something interesting to think about is the fact that if an Indian or Chinese company or an investment group buys Hummer, they have an immediate problem: none of those concerns have ever built anything even close to a Hummer. Therefore, they would have to rely on GM for parts, production technology and engineering for years to come. This might be considered a plus in certain ways by certain potential buyers, and conversely, might be considered a liability in other ways. But for those buyers, it would be an inescapable part of the deal, and would also merit some thought by General Motors in that instance as well.

For now, Hummer production lines keep moving. The new H3 pickup starts production very soon in Shreveport, Louisiana, and will go on sale this fall.

COPYRIGHT Autosavant.net – All Rights Reserved

Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

Share This Post On

5 Comments

  1. It could be interesting to see who’ll be the winner of the bid and also will it be a complete sale like Jaguar/Land Rover or they could keep a small stake (10%) in Hummer like Ford did with Aston-Martin? (or Tata/Mahindra/consortium “x” buy Hummer and a small stake of GM)

    Then, I remember when I explore some old news then Renault had once checked an eye on Saab. (I got to admit then I have a bit some fun to re-read some old articles like this one). I’m very surprised then Ghosn might check an eye on Hummer but who knows after it grabbed a 25% stake of Lada(AVTOVaz)?

  2. The world sure has changed with 4 buck-a-gallon gas! What will it be like when gas is 6 bucks a gallon? How about 8 bucks?

  3. Good, I hope those gas-swilling monstrosities go away forever.

  4. I love my Hummer. It’s the best vehicle I’ve ever owned. I consider it an American classic. These things will be collector cars years from now when all we have on the roads are tiny little electric cars.

  5. Hey, Greg, you keep believing that, buddy. And there’s gonna be democracy in the Middle East at the same time.

Submit a Comment

Your email address will not be published.