South Korean automaker Ssangyong, a small player in the global automotive market, has idled its plants and delayed payment of salaries in response to a drastic lack of capital. But the government of South Korea says it’s not planning to bailout the automaker, which is controlled by China’s Shanghai Automotive Industry Corporation.
Earlier today, the state-run Korea Development Bank asked SAIC to provide $247 million to help save the Korean carmaker, which is best known for its sports utilities. If SAIC provided the money, the Korea Development Bank would also loan money.
The Ssangyong situation shows just how far Korea is willing to go to save its large automakers – and it provides a glimpse of how Chinese automakers will save their foreign assets during the global downturn.
Ssangyong is owned 51 percent by SAIC. The Korean automaker has had a tumultuous time marked by union-management clashes since the Chinese automaker took the controlling share, reports the Financial Times.
