SsangYong going for "radical restructuring" and "business as usual"

Last April, the SsangYong's future looked bright, with new diesel hybrid technology and a 20-vehicle global line-up trumpeted loudly. Things went downhill after that, with the company going into receivership (like Chapter 11 bankruptcy) and then the Sollers offer. On Friday, a court in South Korea (SsangYong is a South Korean company) granted the company "court receivership" status. This means the company now has time to restructure itself but also leads to a very confusing press release. As you can read after the break, the announcement says that the change means "business as usual for SsangYong" and also says that that the court's decition paves "the way for radical restructuring." Is it really radical to do business as usual? Whatever. What we're interested in is what this means for Phoenix and their all-electric SUT? We have a email in to Phoenix and will let you know if they have anything to add.

[Source: Koelliker UK Ltd]

PRESS RELEASE:

BUSINESS AS USUAL FOR SSANGYONG

A South Korean court last Friday granted 'court receivership' status to SsangYong Motor (SYMC), paving the way for radical restructuring and the opportunity of forging a stronger and leaner company with a more diversified product range.

Court receivership is similar to US Chapter 11 status, giving SYMC protection from creditors and time to formulate and implement a corporate resuscitation plan. Under the new arrangements, the court has appointed former Hyundai Motor president Lee Yoo-il, and SYMC vice-president in charge of finance, Park Young-tae as co-legal administrators.

Like a huge number of UK businesses, companies around the world have had to deal with the fall-out of the international credit crunch, a drop in demand and even higher oil and energy prices. These factors have had a particularly damaging impact on automotive companies everywhere and the decision follows SYMC's application for court receivership last month. SYMC will now present its restructuring plan by June this year.

The court's decision was welcomed by around 7,200 SYMC employees and creditors, led by state-run Korea Development Bank. Paul Williams, managing director of UK distributor Koelliker UK Ltd. said:

"This is very good news after a worrying period, and I want to thank our staff and dealers for their faith and confidence in toughing it out and getting on with the job. Restructuring won't be easy, but we now look forward to the continuing new model development programme and a fitter and stronger SsangYong, better able to meet the challenges of tomorrow."

He added: "SYMC was profitable in 2007, and as we gradually work our way out of this global recession, there's every reason to look forward to a better future."

In the UK, the SsangYong range comprises the Kyron, Rexton and Rodius passenger cars plus light commercial versions of the Kyron and Rexton. Prices start at only £14,259 and all SsangYongs have a three year/60,000 mile warranty. Costs of ownership were slashed last year with the introduction of very competitive menu servicing and an average 40 per cent reduction in parts prices.