A Chengdu-based machinery company is close to clinching a deal to buy General Motors’ (GM) Hummer brand, making it the first Chinese company to own an American carmaker.

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.

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