ID :
35271
Sat, 12/13/2008 - 05:05
Auther :
Shortlink :
http://m.oananews.org//node/35271
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Ssangyong Motor union warns of 'strong resistance' amid crisis
SEOUL, Dec. 12 (Yonhap) -- The labor union of Ssangyong Motor Co. warned the automaker on Friday against cutting employee benefits and idling its sole assembly plant, saying such moves would meet with "strong resistance."
The union's warning is expected to make things difficult for Ssangyong as it
grapples with a sharp decline in sales of its sport-utility vehicles amid a
prolonged liquidity crisis.
Ssangyong's Chief Executive Officer Choi Hyung-tak has asked the automaker's
parent, China's Shanghai Automotive Industry Corp. (SAIC), to inject fresh
capital to help Ssangyong weather the crisis.
In the third-quarter of this year, Ssangyong lost 28.2 billion won (US$20.7
million), marking its fourth consecutive quarterly loss. Last month, the
automaker's sales plummeted 63 percent from a year earlier to 3,835 units.
In a desperate move to slash costs, Ssangyong has been in talks with its union to
negotiate a temporary closing of its lone plant in the port city of Pyeongtaek,
about 70 kilometers south of Seoul, and cuts from employee benefits.
"If the management wants to talk to us, it should first scrap plans for forced
leave and employee benefit cuts," said Ssangyong's union leader, Han Sang-kyun,
in a letter sent to employees. "If not, the management will face strong
resistance."
Early this month, Ssangyong's CEO said the company's cash reserves are fragile,
and added the automaker may face "a critical period" early next year.
In its letter, the union blamed SAIC for Ssangyong's troubles and demanded to
know why the parent has "failed to live up to its pledge" of capital investment
and "passed the burden of its management failures onto employees."
The Chinese state-run auto firm acquired a 51-percent stake in Ssangyong for $500
million in 2004.
On the same day Ssangyong's union delivered the letter, China's new ambassador to
South Korea, Cheng Yonghua, visited the Pyeongtaek plant.
"The Chinese government will give all necessary support to Ssangyong Motor,"
Cheng was quoted as saying in a statement released by the automaker. "If needed,
the (Chinese) government will cooperate and hold discussions with the Korean
government for the development of Ssangyong Motor."
Cha Ki-woong, a spokesman at Ssangyong, declined to give details on how the
Chinese government would offer its support.
(END)
The union's warning is expected to make things difficult for Ssangyong as it
grapples with a sharp decline in sales of its sport-utility vehicles amid a
prolonged liquidity crisis.
Ssangyong's Chief Executive Officer Choi Hyung-tak has asked the automaker's
parent, China's Shanghai Automotive Industry Corp. (SAIC), to inject fresh
capital to help Ssangyong weather the crisis.
In the third-quarter of this year, Ssangyong lost 28.2 billion won (US$20.7
million), marking its fourth consecutive quarterly loss. Last month, the
automaker's sales plummeted 63 percent from a year earlier to 3,835 units.
In a desperate move to slash costs, Ssangyong has been in talks with its union to
negotiate a temporary closing of its lone plant in the port city of Pyeongtaek,
about 70 kilometers south of Seoul, and cuts from employee benefits.
"If the management wants to talk to us, it should first scrap plans for forced
leave and employee benefit cuts," said Ssangyong's union leader, Han Sang-kyun,
in a letter sent to employees. "If not, the management will face strong
resistance."
Early this month, Ssangyong's CEO said the company's cash reserves are fragile,
and added the automaker may face "a critical period" early next year.
In its letter, the union blamed SAIC for Ssangyong's troubles and demanded to
know why the parent has "failed to live up to its pledge" of capital investment
and "passed the burden of its management failures onto employees."
The Chinese state-run auto firm acquired a 51-percent stake in Ssangyong for $500
million in 2004.
On the same day Ssangyong's union delivered the letter, China's new ambassador to
South Korea, Cheng Yonghua, visited the Pyeongtaek plant.
"The Chinese government will give all necessary support to Ssangyong Motor,"
Cheng was quoted as saying in a statement released by the automaker. "If needed,
the (Chinese) government will cooperate and hold discussions with the Korean
government for the development of Ssangyong Motor."
Cha Ki-woong, a spokesman at Ssangyong, declined to give details on how the
Chinese government would offer its support.
(END)
