Ssangyong shuts down with hundred billion debt

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Korea’s smallest manufacturer, which had a strong collaboration with Mercedes Benz, (salvaging all the latter’s old technology), and was always at the ‘forefront’ of automotive design; with notable examples such as the Ssangyong Actyon coupe SUV that debuted almost 2 years ahead of the ‘World’s First’ Coupe SUV.

It’s now confirmed that Ssangyong had packed up, amidst the increasingly difficult financial turmoil, with 100 billion WON in debt ($77 million USD), Ssangyong was unable to clear even December’s payroll, and to halt all operations by shutting down its manufacturing plants.

Even though Ssangyong is controlled by cash rich SAIC (Shanghai Automotive Industry China), of which SAIC took over Ssangyong back in January 2005 with a total stake of 51.3%, the latter had refused to pump in more cash into the ailing Korean manufacturer because of earlier protests by Ssangyong’s unions asking Chinese executives to step down. With no further options, they have to shut down their plants along with 2,500 white collars and around 5,500 production workers.

Ssangyong saw sharp declines in sales for 2008, with a huge 63% drop in November alone compared to prior year, and a 34.5% drop for January till November versus prior year.

Ssangyong’s executive committee reveals that they’ll launch a protest against the Chinese managements in front of the company’s Pyeongtaek plant in Gyeonggi Province; as this is the first time ever in Korea that an automaker fails to settle wages of employees.

Source: Chosun