Ssangyong Motor Co. workers plan to launch a full-scale strike today just as its major creditors are about to announce the preferred bidder for the automaker, China's largest car company, government-owned Shanghai Automotive Industry Corp.
Ssangyong Motor, Korea's No. 4 automaker, manufactures about 10 percent of the Korean market. Its focus is sport utility vehicles including Korando and Rexton,
The strike by Korean workers stems from several concerns including doubts that Shanghai Automotive has enough engineering or financial resources to support Ssangyong's further growth.
Nevertheless, Song Sang-hoon of Hyundai Securities said Shanghai Automotive could open doors in China for Ssangyong vehicles.
In addition, Shanghai Automotive does not have a sport utility vehicle, so Ssangyong could supply its flagship SUVs.
Ssangyong Motor came under creditor ownership after its parent Daewoo Group collapsed in 1999 under a mountain of debt.
Shanghai Automotive has 50 plants in metropolitan Shanghai, China's most highly populated area with more than 14 million people. Its divisions produce passenger cars, trucks, buses, motorcycles, tractors and automotive parts.
Shanghai Automotive currently has ventures with two of the largest foreign carmakers in China - GM and Volkswagen. These joint ventures account for nearly 30 percent of the Chinese auto market. Hyundai Automotive Group, Korea’s largest car producer has a 2% share of the Chinese market with plans to expand its operations to 10% in the next few years.
Experts here predict the Asian market will double to 10 million vehicle sales a year by 2010.
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