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AutoBlog: Chinese government unlikely to approve Hummer purchase deal?

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Filed under: SUVs, China, Government/Legal, HUMMER, Earnings/Financials

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According to a report from Bloomberg, state-owned Chinese news agency Shanghai Securities News is predicting that it is unlikely the Chinese government will approve the purchase of Hummer from General Motors by Sichuan Tengzhong Heavy Industrial Machinery Co. Why? Apparently, China actually wants to reduce the number of automakers operating within its borders and favors keeping manufacturers with an eye towards fuel efficiency. Of all the labels people have put on the Hummer brand, fuel efficient hasn't exactly been one of them. According to Tim Payne, a spokesman for Tengzhong:

"Some people may have views and speculation but the Chinese government has a process that we respect. We have only just signed an MOU but as we develop our proposals with GM and Hummer we will continue to work with the appropriate authorities."

In other words, it's too early to draw conclusions about whether or not China will approve of the purchase of Hummer. However, it does seem unlikely that Tengzhong would enter into the deal with the belief that the Chinese government would squash it, no?

[source: Bloomberg]

Chinese government unlikely to approve Hummer purchase deal? originally appeared on Autoblog on Fri, 05 Jun 2009 15:28:00 EST. Please see our terms for use of feeds.

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