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Ssangyong Motors, GM Korea Moving in Opposite Directions
Opposite Directions
Ssangyong Motors, GM Korea Moving in Opposite Directions
  • By Jack H. Park
  • January 20, 2015, 09:54
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According to industry sources, Ssangyong Motors sold 141,047 cars last year, including 72,011 in overseas markets, to show a 3.2 percent drop from a year ago. Although it attained a 7 percent growth in the domestic market, the plummeting international oil prices and sharp depreciation of the ruble dragged down exports by 11.8 percent.

During the same period, GM Korea sold 154,381 cars in the domestic market and 476,151 abroad to record a 19.2 percent drop year on year. It grew 2.2 percent in the Korean market, but its exports fell 24.4 percent from a year earlier as the Chevrolet brand withdrew from the European market.

Both of them showed similar sales trends in 2014 but the percentages showed a stark difference. This is because the parent company of Ssangyong Motors is trying actively to turn the tables and settle the conflicts between the labor and the management while GM Korea is regarded as a headache by its parent company, which is planning on layoff in the near future.

GM Korea’s exports are likely to keep falling until 2016, when Chevrolet’s withdrawal from Europe is completed. Its Gunsan Plant, only 60 percent of which is running now due to the dropping exports, seems to be unable to avoid personnel reduction in just a year. The next-generation Cruze is likely to be manufactured in facilities other than the Gunsan Plant.

Ssangyong Motors, in the meantime, is maintaining a win-win relationship with the Mahindra Group. The Tivoli, its latest model developed by the parent group’s 80 billion won investment, is expected to turn the company into a profit this year. Ssangyong is also planning to come up with three new SUVs for three years to come at an investment of one trillion won in total.

“What matters the most now is the normalization of the business of the automaker and guarantee of employment for the 4,800 incumbent workers,” chairman Anand Mahindra said on January 14 during his visit to Ssangyong’s Pyeongtaek Plant, adding, “I promise I will let in the workers who retired in 2009 in stages once our business conditions get better with the Tivoli.”