550 employees and 70 to 80 partners
We already endure reductions in employee salaries
“I was expecting it, but it was a disastrous”
“I was expecting it, but it’s disheartening to hear that the company has applied for court administration.”
The members of the Changwon plant, which produces engines, the heart of Ssangyong Motors, are embarrassed by the news that the company has applied for corporate rehabilitation procedures.
Ssangyong Motor applied for rehabilitation procedures to the Seoul Rehabilitation Court on the 21st. It has been 11 years since Ssangyong Motors applied for legal management for normalization, such as canceling some of its debts.
Ssangyong Motor’s Changwon Engine Factory was established in June 1994. The Changwon Plant, located in the Changwon National Industrial Complex, Seongsan-dong, Seongsan-gu, Changwon-si, consists of a plant that makes small gasoline engines and a plant that makes medium-sized engines over 2000㏄.
Starting with the production of 1 million engines in 2004, the production of 2 million engines in 2013 and 3 million in February this year. Including technical workers, 550 people are employed in the Changwon plant. There are 70-80 partners including Samsong, GMB Korea, and Schaeffler Korea.
Ssangyong Motor hasn’t been able to produce a new car that can be said to have been since the launch of the’Tivoli’, a small sports utility vehicle (SUV) in 2015, and lost 15 consecutive quarters from the first quarter of 2017 (January to March) to the third quarter (July to September) Is being recorded.
The annual sales volume, which exceeded 150,000 units in 2016, is expected to reach only 100,000 units this year.
An official at Ssangyong Motor’s Changwon Plant said, “We have already made our own efforts, such as reducing annual salary by more than 10 million won per employee,” and said, “At such times, we encourage each other to focus on making the best engines without accidents.”
The government operates a support group to alleviate the shock of parts suppliers resulting from the start of the Ssangyong Motor rehabilitation procedure. The policy is to provide maximum support so that the initiation of the rehabilitation procedure for Ssangyong Motors does not become a continuous negative for related parts makers through funding support for business partners, such as extending the maturity of loans using a policy finance program.
Ssangyong Motor also applied for the application of the Autonomous Restructuring Program (ARS) along with the rehabilitation procedure. ARS is a system in which the initiation of rehabilitation procedures is delayed for up to three months after the court confirms the intentions of the creditors. Rehabilitation Procedure Hold Period If the stakeholders agree and withdraw the application for rehabilitation procedures, the company can return to a normal company.
Ssangyong Motors announced on the 22nd that the principal and interest of loans worth 255.3 billion won were overdue. The principal loan amount is 255 billion won, including 90 billion won by Korea Development Bank and 7.5 billion won by Woori Bank. Interest is 270 million won. This is 34.07% of the equity capital (based on the latest capital due to capital erosion) of 749.2 billion won.
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Ssangyong Motors applied for corporate rehabilitation due to liquidity crisis