HUMMER TO CONTINUE PRODUCTION!!!

A spokesman for GM announced this morning on CNBC that the "Hummer Division has signed a memorandum of understanding and production will continue under contract with GM on the H2 and H3 models for 2010." He also stated that the H3 plant may see an INCREASE IN EMPLOYMENT as production of the international version of the H3 is moved from South Africa to Louisiana. GM's new agreement with the investor continues production in both the Shreveport and Mishawaka plants and will save an estimated 3700 jobs in manufacturing, engineering and sales. Part of the new agreement is aimed at saving the existing Hummer dealerships and their sales and service staff, according to the GM spokesman.


“GM has developed HUMMER into a globally recognized off-road brand,” said James Taylor, HUMMER chief executive officer. “The proposed agreement will enable us to continue that growth and maximize the brand’s potential through new, innovative off-road vehicles with improved efficiency and alternative fuel powertrains. Today’s announcement is great news for HUMMER’s current and future customers, dealers, suppliers and employees around the globe.”
During the transition, the investor will contract manufacturing of HUMMER vehicles to General Motors, which operates the H3 and H3T plant in Shreveport, LA and remains under contract with AM General for HUMMER H2 production.

“HUMMER is a strong brand,” said Troy Clarke, President of GM North America. “I’m confident that HUMMER will thrive globally under its new ownership. And for GM, this sale continues to accelerate the reinvention of GM into a leaner, more focused, and more cost-competitive automaker.”


At this time details about the new investor are being kept close to the vest, but The Phantom confirms that the memorandum of understanding is "most likely" with a Chinese company. The Phantom also told me this morning the new Hummer headquarters will be in the United States and the new group is very interested "in strengthening the current Hummer dealership network." He also said the new investor wants to move forward with the H2, H3, & H3T and possibly and even more fuel efficient downsized H3 to be known as the H4. He said, at this time production numbers and schedules for the 2010 Hummers will depend on how fast the economy rebounds. There was no comment made about possibly restarting production the H1 Alpha.

The Phantom tells me that THIS IS FAR FROM A DONE DEAL! THIS IS A MEMORANDUM OF UNDERSTANDING NOT A SALE, AND IT STILL HAS TO BE APPROVED BY SEVERAL CHINESE REGULATORS AND THEN TWO US REGULATORY AGENCIES! THEN ALL THE CONDITIONS OF THE MEMORANDUM MUST BE FULFILLED FOR THE SALE TO GO THROUGH. The Phantom advises me not to count out Mr. Perelman yet at AM General. Hmmmmmmmm

New from Bloomberg
June 2 (Bloomberg) -- General Motors Corp. plans to sell its Hummer brand of sport-utility vehicles to Sichuan TengzhongHeavy Industrial Machinery Co. Ltd., a Chinese equipment maker,according to five people familiar with the situation.GM, which filed for bankruptcy protection yesterday, has amemorandum of understanding with the Chengdu, China-basedcompany, said the people, who declined to be identified becausethe agreement is confidential. At least one other party is still interested in buying Hummer, though those talks are on hold, oneof the people said.

For GM, it’s an important milestone in the company’s restructuring efforts focused on profitability and long-term sustainability.This transaction will also secure more than 3,000 jobs directly related to HUMMER in the U.S. in terms of engineering, manufacturing and dealerships, and between 8,000 and 10,000 industry-related jobs overall.