Ssangyong's bankruptcy deal

By Seonjin Cha | February 7, 2009, Saturday |

Print Edition

SSANGYONG Motor Co, South Korea's smallest car maker, was placed in bankruptcy protection after vehicles sales tumbled 30 percent last year.

Park Young-tae, Ssangyong's current financial director, and Lee Yoo-il, a former Hyundai Motor Co president, will act as receivership managers, the Seoul Central District Court said in a faxed statement yesterday. The court could still seek liquidation if the managers' turnaround plan is deemed unviable.

The decision ends Shanghai-based SAIC Motor Corp's four-year control of the car maker, hindering the Chinese company's efforts to develop own-brand models and reduce its reliance on making General Motors Corp and Volkswagen AG vehicles in China.

"All global auto makers are struggling with tumbling sales," KB Investment & Securities Co analyst Sohn Myung-woo told Bloomberg News. The problems are even worse for Ssangyong as "it doesn't have the right cars to sell."

Sales tumbled to 92,665 vehicles last year, 42 percent less than in 2002.

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Ssangyong's bankruptcy deal

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