You might want to reconsider your position if you're feeling 'hard done by' this Christmas. South Korea's smallest car maker Ssangyong, owned by Shanghai Automotive Industries China (SAIC), has announced that it may not be able to pay salaries on time this month, citing financial pressures.
A Ssangyong spokesman, Choi Nam-hyun, confirmed the car maker's difficulties saying that it may have to delay paying December salaries to its 8000 strong workforce, due 25th December.
Collapsing sales and a struggling world economy have not helped Ssangyong's position, but there is more to this than meets the eye. According to Associated Press reports, SAIC has refused to provide a cash injection into Ssangyong "due to the union's demand that management step down and the holding of a protest at the Chinese Embassy in Seoul".
Wounded pride and company shenanigans aside, letters sent to workers paint a grim picture:
"The company is expected to post a deficit of more than KRW$100 billion (AUD$113,723,523) this year alone. Due to lack of operating funds for December, it is impossible for the company to pay salaries any longer."
The Ssangyong executive committe is now planning to protest against management in front of the Pyeongtaek plant in Gyeonggi Province at 8:30 a.m. on Monday.
For now, operations of all plants will be suspended for three weeks as the company looks for a way out of its financial crisis. Domestic sales have dropped 34.5 percent this year, with November seeing a staggering 63 percent drop alone compared to the same time last year.
With Ssangyong dealerships, and sales, disappearing rapidly, it's not looking good for the Korean manufacturer nor for its affected workers. Unfortunately however, it appears that Ssangyong workers are caught by more than the global economic downturn - they're also caught in an arm wrestle between Chinese parent SAIC, brittle Chinese pride, and Ssangyong's Korean union.