In an effort to downsize their corporation, G.M. announced the selling of two product lines. The Hummer and Saturn lines are being looked at by two different corporations for a possible buyout.
A tentative deal is in the works with the Chinese based Sichuan Tengzhong Heavy Industrial Machinery Co. for the Hummer line. The company mainly deals in the heavy equipment arena for road construction, and this will be their first dealings in the auto sector. The sale of this product will most likely save more than 3000 much needed jobs in the United States, as the Hummer will still be produced state side until 2010.
After filing for chapter 11 bankruptcy protection in New York Monday, G.M. hopes to emerge a smaller, stronger auto maker. Concentrating on the Chevrolet, Cadillac, Buick, and GMC products, the organization is looking toward the future in a much smaller role. Hummer sales are down a reported 67 percent from last year, fueling the sale of the line.
In another big decision, the auto maker announced the selling of the Saturn product line to former race car driver and dealership owner Roger Penske. By acquiring the line, Saturn’s 350 dealerships will be added to Penske’s own chain Penske Automotive Group. New franchise agreements, and all of Saturn’s 13,000 employees will be retained. Penske Automotive Group also deals Daimler Ag’s smart compacts currently in the U.S., but with the Saturn dealership network already in place, the dealers will still only deal exclusively in the Saturn line.
Bankruptcy court and the selling of two major product lines do not look good for the auto giant. But with the downsizing efforts and a restructuring plan in place, G.M. is poised for a major come back. Like Chrysler, the company is hoping for a quick emergence from bankruptcy protection. Sources say that both parties could be done in as little as 30 days. After a long, hard road of financial troubles, the future is starting to look a little brighter.