Ssangyong Motor closes main factory in response to labor strike

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SEOUL, May 31 (Yonhap) -- Ssangyong Motor Co., a South Korean automaker under
bankruptcy protection, said Sunday it has closed its main factory south of Seoul,
responding to a labor strike staged ahead of massive job cuts.
The automaker's labor union walked off the job on Thursday after a series of
negotiations with the management made little headway. Ssangyong, which has been
under bankruptcy protection since February, said last month it will cut 2,646
jobs, or 36 percent of its total workforce, and get 250 billion won (US$200.5
million) in new loans by offering the main plant in Pyeongtaek as collateral.
"The closure was inevitable" for the company's survival, Lee Yoo-il, Ssangyong
Motor's legal trustee, said.
"The company will use all its resources to complete the restructuring and
normalize management as early as possible," he said.
The management closed the Pyeongtaek factory, about 70 km south of Seoul, at 8:30
a.m. and will consider requesting police forces if unionized workers refuse to
leave the factory.
The labor union has called for the government's financial assistance to prevent
massive layoffs amid the economic meltdown and help resuscitate the automaker by
enlarging its market share.
The company is 51-percent owned by China's top automaker, Shanghai Automotive
Industry Corp., which has balked at providing more support.
Ssangyong, the maker of the Rexton sport utility vehicle and the Chairman luxury
sedan, became the nation's first big corporate casualty of the global economic
slump that dampened demand for new cars.
Early this month, the Seoul Central District Court said Ssangyong is worth saving
rather than liquidating, but warned it could still liquidate the ailing carmaker
if it fails to make the job cuts as promised.
hkim@yna.co.kr
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