Reuters is confirming earlier reports that Indian car-maker Mahindra and Mahindra is in talks with GM regarding a purchase of the HUMMER brand. One of their sources says that Mahindra doesn’t have an overwhelming desire to purchase the brand, but early discussions are continuing. Automakers in Russia and China are also said to be potential buyers, but specific companies were not identified.
Stateside, GM’s primary financing partner GMAC announced a $2.5 Billion hit today, and also announced plans to scale back leasing. Roughly $18 billion of GMAC’s $30 billion lease portfolio is on trucks and SUVs – and in June, GMAC only recovered about 75% of their expected returns on SUVs. The changes in the U.S. won’t be as drastic as GMAC’s complete elimination of auto leasing in Canada, but they will be scaled back. GMAC lease rates will be increased, and their criteria for approval will be more stringent according to Left Lane News. Also, GMAC SmartBuys will be discontinued, according to the Earth Times.
The news shouldn’t come as much of a shock – after all, a company like GMAC can only take so many losses before it needs to dramatically change its ways. Hopefully GM and GMAC will be able to keep leases affordable, since many consumers choose leasing and SmartBuys for their low monthly payment.