SAIC stake in Ssangyong may come to nothing
- Source: Gasgoo
- [10:11 August 06 2009]
- Comments
Chinese auto giant SAIC Motor may see its 51 percent stake in Ssangyong Motor come to nothing, if the Korean carmaker really goes to bankruptcy, media reported.
Since July 30, 2009, Ssangyong Motor's labor union has repeatedly asked the company to re-employ 600 fired workers, who are members of the union. But the Korean automaker's management rejected the requirements, in line with its job cut plan.
About 600 laid-off workers have occupied Ssangyong Motor's coating workshop for more than 70 days, halting production lines. The company has lost production of 14,590 vehicles worth 316 billion won ($259 million) because of the jobless workers' occupation.
South Korean police in full riot gear descended on autoworkers at embattled Ssangyong Motor on Wednesday in an operation to break up a sit-in by unionists demanding to keep their jobs. But the local police failed to release the tension.
Ssangyong Motor's spokesman said on Aug. 3 that if the dismissed workers kept interrupting the company's production, it would seek liquidation, rather than meet a Sept. 15 deadline set by a bankruptcy court to submit a turnaround plan.
However, SAIC Motor has provided about 3 billion yuan ($439 mln) for asset impairment, according to its first quarter financial report. SAIC has lost management control of Ssangyong since the Korean SUV maker entered receivership in February.
Cash-strapped Ssangyong, S. Korea's smallest automaker 51 percent owned by China's top automaker SAIC Motor, had been pushing to cut more than a third of its workforce of 2,600 in a bid to resuscitate the company.
