Filed under: China, Hirings/Firings/Layoffs, Earnings/Financials
Ssangyong enters receivership
Could it be too late for Ssangyong? Shanghai Automotive Industry Corp. (SAIC) appears to have given up on Ssangyong Motor Co., allowing the company to slip into receivership. SAIC holds a 51% stake in Ssangyong, but gave up management rights in a bid to avoid liquidation and allow Ssangyong some time to get back in the black. The Korean automaker's Chief Executive Zhang Hai Tao and President Choi Hyung-tak both stepped down after the filing.As recently as a couple of days ago, SAIC said they would help prop up Ssangyong, but that apparently has changed. As vehicle sales have fallen a whopping 50%, money was clearly tight. With the global economic crisis, credit was evidently unavailable to pay workers and new negotiations with the unions weren't going anywhere fast. This receivership agreement protects Ssangyong from creditors and keeps it from entering bankruptcy, allowing it some time to get back on its feet. For its part, SAIC said that it "will work with all parties so that Ssangyong can achieve a plan to normalize its operations." Thanks for the tip, Ken!
[Source: Market Watch]
Reader Comments (Page 1 of 1)
Conundrum 6:08PM (1/09/2009)
SAIC has gotten what it wanted...
Technology without working for it and one less competitor to compete with.
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happy_penguin 6:14PM (1/09/2009)
Let it fail!!
_______________DIE DIE DIE
KILL IT!!
_______________DEATH TO SSANGYONG!!!!
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Frank 7:51PM (1/09/2009)
Love your sarcasm!
happy_penguin 8:05PM (1/09/2009)
Thanks for recognizing it without my adding tags. ;)
hypermiler 7:11PM (1/09/2009)
According to Ssangyong insiders, SAIC's conserving its fund to make a bid on Chrysler.
We can presume that the same fate would befall upon Chrysler after a sale to SAIC or some other Chinese automaker, which would asset-strip, transfer all technology, then just keep the brand name and distribution network.
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None 11:53PM (1/09/2009)
Actually it's never a good idea to sell things to the qinese. I used to hate this brand but after a qinese company took some stake I hated it even more. Now that they pulled out I'm feeling better.
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jeff 6:56AM (1/10/2009)
It is so fashionable to accuse China whatever happens, and it's also a very good way to decompress or to explain failure at this hard time, right? Well, if it really works, go on.
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John 10:30AM (1/10/2009)
Good point. Mindlessly blaming China for every problem shows a lack of any real incite.
Richard S. 2:19AM (1/11/2009)
They should go back to their original name: Dong-A Motor. At least one who buys it can tell another: "My Dong-A is bigger than yours".
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