GM bought the Hummer brand in 1999
General Motors (GM) has agreed to sell its iconic Hummer brand to Chinese firm Sichuan Tengzhong Heavy Industrial Machinery for an undisclosed fee.
The two parties had been in talks about the sale for a number of months.
GM is in the process of selling and winding up a number of brands as it looks to reorganise after emerging from bankruptcy protection in July.
At the start of this month, the troubled carmaker announced it would be winding down its Saturn brand.
This was after the proposed sale to Penske Automotive Group collapsed.
GM has already announced that it is discontinuing the Pontiac brand, and is close to finalising the sale of its European brands Saab, Opel and Vauxhall.
Saab (to be sold)
Opel (to be sold)
Vauxhall (to be sold)
GM plans to reinvent itself by concentrating on fewer brands following bankruptcy protection, made necessary after car sales plummeted during the downturn.
Under the terms of the Hummer deal, Tengzhong will take an 80% stake in the company, with the remaining 20% going to Hong Kong entrepreneur Suolong Duoji.
The current Hummer management team will continue to run the company.
The deal is still subject to regulatory approval.
"Hummer is a strong global niche brand and this agreement signifies another important milestone in writing the next chapter of both GM and Hummer," said GM boss Fritz Henderson.
The company also said it would be focusing on improving efficiency, including the introduction of diesel engines.
"We are excited about some of the initiatives already underway at Hummer that we believe our investment will be able to accelerate, particularly related to the creation of the next generation of more fuel efficient vehicles to meet not only future regulations but also customer expectations," said Yang Yi, chief executive of Tengzhong.
Hummers were originally built as military off-road vehicles by a company called AM General.
The brand took off as US motorists flocked to the sport utility vehicles favoured by celebrities including Arnold Schwarzenegger.
GM bought the Hummer brand in 1999, but sales have suffered recently as the gas-guzzling performance and military image have become less popular.
Hummers weigh up to five tons and have fuel consumption of around 15 miles per gallon.
Tengzhong specialises in making equipment for the road, construction and energy industries.
It is based in China's Sichuan province.