ID :
53519
Thu, 04/02/2009 - 17:14
Auther :
Shortlink :
https://www.oananews.org//node/53519
The shortlink copeid
GM Daewoo faces 'critical' phase in Q2 over liquidity
(ATTN: UPDATES throughout with fresh quotes; CHANGES headline)
GOYANG, South Korea, April 2 (Yonhap) -- The South Korean unit of General Motors
Corp. said Thursday it is facing a "critical" phase in the second-quarter of this
year due to liquidity concerns as its U.S. parent reels under a possible
bankruptcy.
Michael Grimaldi, the chief executive of GM Daewoo Auto & Technology Co., which
is seeking one trillion won (US$735 million) in financial aid from South Korea's
state-run Korea Development Bank (KDB), said the company's cash position for the
April-June period was worrisome.
"We are monitoring our cash position very closely," Grimaldi told reporters on
the side lines of the 2009 Seoul Motor Show, saying it had become "critical."
KDB has so far shown little sympathy for GM Daewoo's request for financial
assistance.
Late last month, Nick Riley, chief of GM operations in the Asia-Pacific region,
met with bank officials to request the bailout fund, which was denied by the
South Korean bank citing uncertainty over the fate of GM.
Grimaldi said GM Daewoo was also mulling selling assets to raise funds.
This week, the administration of U.S. President Barack Obama rejected plans for a
turnaround by GM and Chrysler LLC, giving them one final chance to save their
companies. He also warned that GM may have no choice but to face bankruptcy if it
fails to map out sweeping cost-cutting plans and concessions with the United Auto
Workers union and bondholders.
Despite its own dire financial situation, Grimaldi said the company plans to
spend 2.5 trillion won in facility investment by 2010.
"We got off to a rough start this year amid a severe economic crisis and slow
automotive demand worldwide," Grimaldi said.
"But we are taking necessary actions to overcome the crisis... and plan to invest
2.5 trillion won by the end of next year to build new facilities," Grimaldi said.
Grimaldi unveiled a version of the Chevrolet Volt for the first time in Asia
during the exhibition here.
Designed to be rechargeable at conventional power outlets, the Volt will be able
to run 64 kilometers on battery power alone, with an internal combustion engine
that increases its driving range.
"The Volt is a game-changer," Grimaldi said. "This represents the future
direction of the automotive industry and GM Daewoo."
"We plan to release a small fleet of the Volt in South Korea in 2011 to gauge
consumer demand," he said.
Since December last year, GM Daewoo has idled or closed some production lines as
sales plunged. GM Daewoo is closing its plants for as many as 10 days in April.
In March, GM Daewoo said its auto sales plunged 48.5 percent to 44,957 units,
with domestic sales dropping 44.6 percent to 5,708 units and exports diving 49
percent to 39,249 units.
(END)
GOYANG, South Korea, April 2 (Yonhap) -- The South Korean unit of General Motors
Corp. said Thursday it is facing a "critical" phase in the second-quarter of this
year due to liquidity concerns as its U.S. parent reels under a possible
bankruptcy.
Michael Grimaldi, the chief executive of GM Daewoo Auto & Technology Co., which
is seeking one trillion won (US$735 million) in financial aid from South Korea's
state-run Korea Development Bank (KDB), said the company's cash position for the
April-June period was worrisome.
"We are monitoring our cash position very closely," Grimaldi told reporters on
the side lines of the 2009 Seoul Motor Show, saying it had become "critical."
KDB has so far shown little sympathy for GM Daewoo's request for financial
assistance.
Late last month, Nick Riley, chief of GM operations in the Asia-Pacific region,
met with bank officials to request the bailout fund, which was denied by the
South Korean bank citing uncertainty over the fate of GM.
Grimaldi said GM Daewoo was also mulling selling assets to raise funds.
This week, the administration of U.S. President Barack Obama rejected plans for a
turnaround by GM and Chrysler LLC, giving them one final chance to save their
companies. He also warned that GM may have no choice but to face bankruptcy if it
fails to map out sweeping cost-cutting plans and concessions with the United Auto
Workers union and bondholders.
Despite its own dire financial situation, Grimaldi said the company plans to
spend 2.5 trillion won in facility investment by 2010.
"We got off to a rough start this year amid a severe economic crisis and slow
automotive demand worldwide," Grimaldi said.
"But we are taking necessary actions to overcome the crisis... and plan to invest
2.5 trillion won by the end of next year to build new facilities," Grimaldi said.
Grimaldi unveiled a version of the Chevrolet Volt for the first time in Asia
during the exhibition here.
Designed to be rechargeable at conventional power outlets, the Volt will be able
to run 64 kilometers on battery power alone, with an internal combustion engine
that increases its driving range.
"The Volt is a game-changer," Grimaldi said. "This represents the future
direction of the automotive industry and GM Daewoo."
"We plan to release a small fleet of the Volt in South Korea in 2011 to gauge
consumer demand," he said.
Since December last year, GM Daewoo has idled or closed some production lines as
sales plunged. GM Daewoo is closing its plants for as many as 10 days in April.
In March, GM Daewoo said its auto sales plunged 48.5 percent to 44,957 units,
with domestic sales dropping 44.6 percent to 5,708 units and exports diving 49
percent to 39,249 units.
(END)
