Sichuan Tengzhong Heavy Industrial Machinery Company is expected to spend between $150 million (£90 million) and $250 million on Hummer, the gas-guzzling brand of sports utility vehicles popularised by Arnold Schwarzenegger before he embraced the environment.

GM, which filed for Chapter 11 bankruptcy protection on Monday, declined to name the prospective buyer but promised that Hummer’s new owner would “aggressively fund future Hummer product programmes”.

It will make Hummers in the United States “during a defined transitional time period”, according to a GM statement, saving up to 3,000 jobs at factories and dealerships.

Sources said that one assembly plant was likely to stay open until at least 2012, but the Chinese company, which is owned by a group of private equity investors, is not expected to give any guarantees on its future manufacturing plans.

An announcement by GM last month that it would make up to 51,000 small cars in China each year to be sold in America drew protests from lawmakers.

The company was forced to back down on the proposal as part of an agreement with the United Auto Workers union.

Nanjing Automobile Corporation bought MG Rover in Britain in 2005, promising to employ 2,000 people at the plant at Longbridge in the West Midlands. Two years later, it scaled the numbers back to 250.

Troy Clarke, president of GM North America, said he was confident that Hummer would thrive globally under its new ownership.

Tengzhong plans to move the brand into new markets, including China, where individual entrepreneurs already import them.

In the US, demand for expensive, fuel-inefficient Hummers has waned.

GM sold 27,485 in America last year, down 51 per cent on 2007. It is developing cleaner fuel technology and a Hummer hybrid and Tengzhong will continue that work.

The Tengzhong deal will not affect the US Army’s military Humvees, on which Hummers are based. Humvees are made by AM General, which sold the Hummer brand to GM in 1999.

The sale of Hummer comes after a review of GM’s brands. GM said that 16 parties had registered an interest in purchasing its Saturn brand and three were looking at Saab.

Its Pontiac brand will be phased out. The restructured GM, which hopes to emerge from bankruptcy protection by the start of August, is to concentrate on Chevrolet, Cadillac, Buick and GMC brands.

GM sold 81,009 vehicles in May, down 38 per cent on May last year.

GM sells Hummer to China and saves 3,000 jobs

But as the Obama administration weighs whether and how to proceed with a request from General Motors Corp for up to $30 billion in federal aid, some experts and even consultants who have worked for the automaker, say a massive cash injection now may not cure everything that ails GM.

What GM needs, they say, is a radical shake-up of an inward-looking century-old corporate culture dominated by financial executives focused on chasing the next deal in a failed effort to reverse the automaker’s decades-long decline.

Many middle managers and other salaried workers, they say, have been too comfortably cocooned for too long.

“GM has developed a lot of bright people but it has also bred insularity,” said Harley Shaiken, a professor at the University of California, Berkeley and an expert on labor-management issues in the auto industry.

“GM for much of its history was so large that it thought it was a proxy for the world. It is not,” he said.

Through $82 billion in losses over the past years and a close brush with bankruptcy, GM’s board has remained firm in its backing of Chief Executive Rick Wagoner.

Now, even some former critics have come around to the view that Wagoner should stay on to guide the company through its cash crunch, but others also say the time is right to begin thinking about what kind of GM emerges from this crisis.

“There are people who are saying, let’s fire the coach, but that’s not the answer,” said University of Maryland economist Peter Morici. “This is the fourth game of the World Series and you have to play with the team you’ve got.”

GM has already taken $13.4 billion in emergency government funding, and the autos task force assembled by President Barack Obama will have to decide how much more it needs and where to draw the line as the political and fiscal toll of bailouts of the banking and auto sectors mount.

But nothing in GM’s 117-page turnaround plan submitted to the U.S. Treasury discusses how it plans to reinvent itself or change decision-making at a one-time industrial powerhouse credited with pioneering professional management under its legendary Chairman Alfred Sloan in the late 1930s.

LIFE OR DEATH?

“My contention is that a lot of the changes they are facing now could have been made five years ago,” said Brad Coulter, a restructuring adviser at O’Keefe & Associates near Detroit. “They had the opportunity to act while markets were strong. Now we’re facing a life or death situation.”

Case in point: In 2006, Jerry York, a GM board member and adviser to billionaire investor Kirk Kerkorian, had urged the automaker to unload Saab and Hummer. GM resisted.

Now Saab is in court-supervised reorganization in Sweden and Hummer could be shut down in the coming weeks if a buyer is not found at a fire-sale price.

Other GM deals in the eight years under Wagoner have fallen short of promise or plain backfired.

In 2005, just as its U.S. operations began to face deeper trouble, GM agreed to pay Fiat SpA $2 billion to avoid having to take over all of the Italian automaker.

That was on top of the $2.4-billion in GM stock paid to Fiat in 2000 to get access to its small-car technology.

Now Fiat is ready to move on GM’s home turf as the potential suitor for Chrysler LLC after a proposed GM merger with Chrysler was dropped by the larger automaker.

Fiat stands to get 35 percent of Chrysler without putting up any cash by offering access to the same kind of technology GM had once sought.

Critics cite examples such as those as evidence that any new GM will have to reach outside of its ranks for senior talent and drive home a message at every level of the sprawling company of responsibility when things go off plan.

“There is no accountability,” said Rob Klienbaum, a former GM executive and a longtime consultant for the automaker. “The company has always drawn from the same pool of talent forever and a day — sometimes to disastrous results.”

Klienbaum said he expects to lose all of his business with GM after posting a critique of GM’s corporate culture at the University of Michigan’s Transportation Research Institute — http:www.umtri.umich.edu/content/RetoolingGM.pdf.

His verdict: GM’s culture shows little tolerance for dissent, little appetite for making hard decisions and an insularity that has made it seem sometimes “tone deaf” to broader societal concerns like the environment.

“GM has promised profound and fundamental changes to the taxpayers,” Klienbaum said. “But there is little evidence that they are addressing the fundamental cultural issues that have driven so much poor decision making.”

Klienbaum said his adult children have warned him to be ready for a “Jerry Maguire”-like backlash from his decision to go public with his long-brewing concerns about GM, but he says he believes he had to do just that.

“If they don’t make these changes, they aren’t going to be around at the end of the day,” he said.

GM culture: a problem that cash can’t fix?

ADIA invested $7.5 billon last year in Citi through convertible bonds that pay 11 percent in interest, but it must start converting the bonds into 235.6 million shares in Citigroup from March next year.

“Nothing has changed from ADIA’s perspective at this point. ADIA’s convertible bonds are due for conversion in a phased manner between March 2010 and September 2011, and that stands,” an Abu Dhabi government official told Reuters.

“But it is carefully assessing its options due to the latest events — although no decision is taken yet,” he said, declining to be named.

A spokesman for ADIA, thought to be the world’s largest sovereign fund, declined to comment.

Abu Dhabi is the wealthiest of seven emirates within the United Arab Emirates, the world’s fifth-largest petroleum exporter.

ADIA’s returns as a bondholder have been unaffected by continuing troubles at Citigroup, but the dramatic fall in Citi’s share price has eroded the conversion value of the mandatory convertible bonds.

In the original deal with ADIA, the Citi securities must be converted into common stock at a price between $31.83 and $37.24 a share between March 2010 and September 2011. Citi last traded at $1.50 a share.

Options for the investment include holding them through to the conversion, which may allow enough time for the share price to recover, or converting them early, in a move that may head off the possibility of the U.S. government nationalizing it.

“We know ADIA is following the recent developments closely, but as a bondholder, ADIA’s investments are secure because the U.S. government has left bond holders untouched, unlike other investors such as preferred shareholders,” a senior Abu Dhabi-based banker close to ADIA said.

“However, it is early days, and we need to wait and see what ramifications the latest events would have and whether there would be pressure on investors in bonds to convert (early),” he said.

Citi, he said, has been urging preferred shareholders and convertible bond holders to convert to common stock to help avoid nationalization by the U.S. government.

FORCED CONVERSION?

On Friday, the U.S. government announced it would convert up to $25 billion of its $45 billion worth of preferred stock into common equity at $3.25 per share.

Other preferred shareholders, including the Government of Singapore Investment Corporation and Saudi Arabia’s Prince Alwaleed, will convert up to $27.5 billion of their holdings at the same price.

Abu Dhabi reviewing Citigroup investment

The board met earlier to vote on the deal, which also includes easier terms on a government credit line and preferred stock investment as well as a plan to reduce AIG’s debt to the government, the source said.

AIG board approves revised bailout

Donald Trump, the real estate mogul who has splashed his name on everything from skyscrapers to neckties to bottled water, has suffered a string of recent reversals that threaten to dilute his cachet, say branding experts. His name, which he often licenses to real estate projects in which he has no direct control, has earned him millions.

“His brand is associated with success and making money. And every time the word bankruptcy appears next to Trump, that’s not good,” said Allen Adamson, managing director of Landor, a brand consultancy. “He can take a few chinks in the armor, but I think he’s probably at the limit.”

Famous for shouting “You’re fired!” at the contestants who aspired to his tycoon status and lavish lifestyle on “The Apprentice,” his long-running reality TV series, Trump would never fire himself. But image watchers will be looking for signs he may have lost some of his luster, as the latest season of his show premieres on March 1.

Deutsche Bank Trust Co Americas, a unit of Deutsche Bank AG, is suing Trump for $40 million, the personal guarantee he pledged as security on a $640 million construction loan for the Trump International Hotel & Tower, according to lawsuits filed in New York Supreme Court in Queens.

He defaulted in November, arguing he should not have to pay over $330 million he owes because the world economic crisis constitutes a “Force Majeure” — equating it with war or an act of God.

He also seeks $3 billion in damages, according to court documents.

Becoming “president” of the development was the prize awarded to Bill Rancic, The Apprentice’s first winner.

In Dubai, Nakheel, the property arm of Dubai Holdings, has postponed work on Trump International Tower and Hotel.

Similarly, Florida developers decided not to proceed with a Trump-branded project even after they paid $2.84 million plus half the net sales to put his name on it, according to court documents filed in U.S. District Court in Tampa.

Another risk Trump runs is the clash between his reputation for luxury and living large and the tough economic times, which calls for understatement, Adamson said.

BRAND BUILDING

Trump’s merchandise, as advertised on his website, is far from understated.

“Dress for success,” reads the text touting his men’s suits. “Made from luxurious fabrics with elegant details including silk lining and gold piping on the interior, the collection exudes confidence and high-end style.”

That tone sounds a false note today, Adamson said, because the trumpeting of big spending is out of fashion.

“That whole lifestyle is under scrutiny now,” he said. “Trump has never stood for less is more. That’s the bigger challenge to the Trump brand.”

On the other hand, failure might not tarnish Trump’s image as much as it might seem, said Scott Davis, a partner at Prophet, a branding firm.

Trump has some wiggle room because his story exalts the comeback, not just uninterrupted success. Davis said.

Trump Entertainment’s Chapter 11 filing, for example, marks the third plunge into bankruptcy for the company.

“He’s the guy who bounces back,” Davis said. “He epitomizes a part of the American dream that people latch onto. He’s somebody that has come through contentious times and he ends up back on top.”

So far, at least some of Trump’s associates and license holders are standing by him, opting to try to distance the man from the bankrupt gambling business that bears his name.

“NBC is not going to comment on Trump’s personal business,” said Amanda Ruisi, the show’s NBC spokeswoman.

Drinks America, which markets Trump-brand vodka, pointed out that Trump Entertainment represents little of Trump’s net worth.

But the next installment of The Apprentice will present a challenge, given the contrast between his display of business acumen and the ongoing bankruptcy, Davis said.

Those who do watch might be seeking a pleasure that evokes an easier yesteryear, Adamson said. “Either they’re going to watch it for a nostalgic look back, or as an escape from the misery of watching CNBC.”

Trump’s golden image on trial after bankruptcy