📰 Auto News REPORT: GM close to offloading Hummer for as little as $150 million

[EmersonHart13]

Only 150 MILLION? How much did GM pay initially?

REPORT: GM close to offloading Hummer for as little as $150 million

by Sam Abuelsamid (RSS feed) on Oct 9th 2009 at 10:30AM

Hummer H3T - click above for high-res image gallery​

Not so many years ago, Hummer appeared to be one of General Motors' most potentially lucrative brands. Now, the fallen brand looks poised to fall into the hands of the Chinese very soon. Bloomberg is reporting that a deal to sell Hummer could be finalized in the coming days as Sichuan Tengzhong Heavy Industrial Machinery Co. hammers out a purchase price. During its bankruptcy proceedings, GM estimated the Hummer brand to be worth $500 million, but last week's collapse of the Saturn deal with Roger Penske appears to have made the Detroit automaker ready to accept whatever it can get. The final tab paid by Sichuan Tengzhong could be as low as $150 million.

The Chinese government has thus far been reluctant to approve Sichuan Tengzhong's move for Hummer, in part because of the brand's image as a gas guzzler. The hope is that once a purchase agreement is complete, the regulators will allow it to move forward. For its part, GM likely just wants the deal done and some extra cash in its coffers so it can move on with its streamlining efforts plans.

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[ktraver97ss]

Thats it!! 150mil! Wonder if the bank will give me a loan......ha. I would at least make them real Humvees again.

 

[TransHed]

Its going to be real hard to sell a brand thats sales graph... resembles the drop on the Millenium Force at Cedar Point lol

 

[Yaj Yak]

150 mil for that is ridiculously low.

 

[Turk]

How is 150 million low? They are selling off a product that LOSES money, how is that worth ANY money?

 

[Yaj Yak]

its low.

 

[Turk]

I wouldn't buy a business for 150 million that will just lose me money. Doesn't make sense.

 

[Turk]

Let me rephrase that, I wouldn't take Hummer for free.

 

[Yaj Yak]

its cheap.

 

[Turk]

It's a product that LOSES money. How is that worth any value, let alone 150 million?

 

[Riski]

I had fun bashing them when I was in the Army....

 

[02BlueGT]

It's a product that LOSES money. How is that worth any value, let alone 150 million?

You are taking a risk in purchasing it, but it is a product, and a name with recognition, they will probably only use the name and eliminate most if not all of the current models, they are buying it for the potential profit from putting the Hummer name on a truck of their design..... Just like the idiots at Tigerdirect bought the CompUsa name, for brand recognition, nothing else

 

[ktraver97ss]

You are taking a risk in purchasing it, but it is a product, and a name with recognition, they will probably only use the name and eliminate most if not all of the current models, they are buying it for the potential profit from putting the Hummer name on a truck of their design..... Just like the idiots at Tigerdirect bought the CompUsa name, for brand recognition, nothing else

x2, also, just because the biz isnt profitable doesnt mean the CEO/Owner/Pres doesnt collect a healthy $200-300k salary plus bonuses/benefits.

 

[02BlueGT]

x2, also, just because the biz isnt profitable doesnt mean the CEO/Owner/Pres doesnt collect a healthy $200-300k salary plus bonuses/benefits.

I love that unprofitable business still award bonuses..... but then again if they were really smart they wouldn't be an unprofitable business

 

[Turk]

x2, also, just because the biz isnt profitable doesnt mean the CEO/Owner/Pres doesnt collect a healthy $200-300k salary plus bonuses/benefits.

Do you know how large businesses are run? The CEO and president aren't normally the owners.

 

[02BlueGT]

Do you know how large businesses are run? The CEO and president aren't normally the owners.

yeah, the owners, (if it is a publicly traded company, these are the owners of stock) get hit with the losses, or gains(dividends) hence the CEO's still taking a huge salary, the bonus is the funny part, the salary they make either way... and the average CEO salary in the US is something like $1 Mil per year IIRC

 

[Turk]

CEO is best job in the country, although it has NOTHING to do with buying or owning a business. Let's say KTraver buys hummer for 150 million and appoints himself CEO with a salary of 300k a year. Not bad right? Well teh company loses 1 million a year, looks like the CEO is now making -700k a year. Now if KTraver buys the company and hires a CEO, the CEO gets paid no matter what.

 

[02BlueGT]

CEO is best job in the country, although it has NOTHING to do with buying or owning a business. Let's say KTraver buys hummer for 150 million and appoints himself CEO with a salary of 300k a year. Not bad right? Well teh company loses 1 million a year, looks like the CEO is now making -700k a year. Now if KTraver buys the company and hires a CEO, the CEO gets paid no matter what.

Didn't I just say that?

 

[Turk]

Yup, pretty much.

 

[02BlueGT]

Yup, pretty much.

 

[Fish]

You are buying a brand. Anyone could revamp and make a profit. $150 for a brand like Hummer is a steal.

 

[Turk]

You are buying a brand. Anyone could revamp and make a profit. $150 for a brand like Hummer is a steal.

Then get a loan and buy it.

 

[Bob Kazamakis]

Chinese hummers. Sounds hot.

 

[99PONTIACGP]

Everyone and their mother drives a Hummer. Theyre all over the place. I remember back in the day when I saw a Hummer it was a big deal, now its not because theyre EVERYWHERE. The Hummer brand may come around. its a roll of the dice. Good luck to China.

 

[Fish]

Then get a loan and buy it.

If I could, I would. I would not get approved for the $150 mil loan. On top of having to set up factories, workers, parts, so on and so forth. An existing company can definatly turn Hummer around.