HUMMER’s self imposed goal of wrapping up the brand’s sale to Chinese company Tengzhong this week is unlikely to be fulfilled.
In November, HUMMER CEO Jim Taylor said that approval process was expected to take four to six weeks, and the week of December 1st would mark week six. According to Reuters, the Chinese Ministry of Commerce (MoC) has yet to receive formal application materials from Tengzhong.
On the other side, Tengzhong contends that they’ve been in contact with the government since the signing of the definitive agreement with General Motors in early October.
“We have been cooperating with the government all along and have submitted whatever materials needed for the approval,” a Tengzhong representative told Reuters. “There is little we can do at this stage. We can only wait.”
Wednesday morning, a HUMMER spokesperson confirmed that, “The sale process is still on track and Tengzhong has been working directly with the appropriate government agencies to ensure that the necessary applications and supporting documents have been submitted.”
Reuters talked to a Chinese business analyst who said “Obviously regulators in Beijing can’t see eye to eye on the Hummer buy as it’s a brand going down hill globally.” We view that analysis with some skepticism, since in fact global HUMMER sales (markets outside the U.S.) have shown mostly positive signs even amid a challenging world economy. Some promising markets like Russia and Australia saw large increases in HUMMER sales earlier in the year when nearly every other automaker was showing declines.
The global market is what’s most appealing to Tengzhong and the Chinese government, two parties that have a strong desire to enter the world automotive marketplace.
Unexpected changes at GM (Like the President and CEO stepping down Tuesday) also could have an impact on the speed at which the HUMMER sale is completed.