China Works blog: China manufacturing news, analysis and insights

Is the military-inspired Hummer going for good? Following the collapse of a protracted deal between General Motors and Chinese truck and military vehicles maker Sichuan Tengzhong Heavy Machinery regarding the sale of the Hummer brand, the US carmaker seems likely to wind down the ailing Hummer SUV business.

The move is a far cry from last October’s joint statement that Sichuan Tengzhong – despite considerable scepticism from the Chinese government, which has the power of veto on Chinese company acquisitions overseas – had agreed to buy the Hummer brand, trademark, trade names and intellectual property license rights, and would assume existing dealer agreements. The Chinese company had ruled out, however, the possibility of moving Hummer manufacturing operations to China.

In a statement released this week, Sichuan Tengzhong said it had not been able to obtain Chinese regulatory approval for the Hummer purchase. The Chinese government had voiced concerns that as a domestically-focused manufacturing company, Sichuan Tengzhong did not possess the capacity or managerial know-how to control an international vehicle brand, particularly one whose sales have plummeted in recent years.

It’s all about the car in China. Manufacturing news in Chinese state media is currently dominated by stories about Chinese automakers’ profits, new auto industry investments and impressive projections for passenger car sales growth.

Beyond the automobile, however, the other major manufacturing sector to grab the headlines is renewable energy production. Indeed, China has just announced plans to “build a national renewable energy centre to further shore up development of the industry,” according to the state-run China Daily newspaper.

The establishment of the new centre is “in the preliminary planning stages,” according to Han Wenke, Director General of Energy Research Institute, but it will “be responsible for policy-making, key project and programme management, market and industrial operations, database and information platform establishment as well as international exchanges,” according to the report.

Further details are not yet forthcoming, but China’s new renewable energy centre is being heavily supported by the Danish government, which has agreed to invest up to USD18.5 million in the initiative between now and 2013.

China is the world’s third-largest producer of wind power, and produces around 40 per cent of the world’s solar photovoltaic products, according to official figures.