Detroit, Michigan – General Motors has sold Hummer to Sichuan Tengzhong Heavy Industrial Machinery Company, but will continue to produce the vehicles in the U.S. under contract for a specified number of years.

Under the terms of the agreement, Tengzhong will acquire the brand, trademark, trade names, and specific license rights necessary to manufacture the vehicles. It will also assume the existing dealer agreements relating to Hummer’s dealership network.

Tengzhong intends to purchase Hummer through an investment entity, in which it will hold an 80 per cent stake. The remaining 20 per cent will be held by Suolang Duoji, a private entrepreneur.

Under the agreement, GM’s assembly plant in  Shreveport, Louisiana will continue to assemble the H3 and H3T under contract, while AM General’s Mishawaka assembly plant will continue to produce the H2. Both facilities will produce the specified vehicles until June 2011, with an optional one-year extension until June 2012. GM said that the deal is expected to secure more than 3,000 U.S. jobs related to the sale and manufacturing of Hummer vehicles.

“We are fortunate to have a partner who understands and recognizes the importance of continuing investment in Hummer’s heritage as a U.S.-based and branded company with a view toward capitalizing on global opportunities,” said James Taylor, who will remain in his current role as Hummer CEO. “Backed by a privately-owned and well-capitalized company, we are going to be able to focus on providing customers with more efficient models that deliver Hummer’s promise of authentic, purpose-built design and engineering.”

Hummer is in the process of obtaining emissions certification for a diesel H3 that will be introduced in markets outside of North America. Future developments include alternative fuel powertrains, more efficient gasoline engines, six-speed transmissions and diesel engines.

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