We've been following SsangYong's struggle to gain traction in a woeful global market and it now appears that significant workforce cuts may be inevitable.
According to Gasgoo.com, a decision has been made by the Korean carmaker to lay off 37 percent of its workforce (about 2,700 people), by the end of June.
It is hoped that the workforce cuts will allow SsangYong to continue operating. Its current cash reserves will run out towards the end of June, according to Lee Yu-Il, Director of SsangYong Motor.
"It seems the company will run out of cash at the end of June. The 100 billion won will be needed for the severance pay if the company should be disbanded for reorganisation," Lee said. He also said that the Korean government should provide a financial rescue for the ailing carmaker. Unfortunately for SangYong, the government has not responded.
Mr Lee Yu-Il also criticised SsangYong's slow production - something which, as Director, many might have expected he was in a position to do something about.
" When I stood on the production belt, I even couldn???t feel the move, but when I stepped on the Hyundai???s conveyor belt, the speed could make me dizzy. The production capacity has significantly dropped in SsangYong," he said.
SAIC, the state-owned Chinese car company that owns SsangYong, is continuing its efforts to extract itself from the 'SsangYong situation'.
With sales down 50 percent, a parent company that can see no future in the business and a government that appears to be unwilling to jump in with a rescue package, it would appear that SsangYong's future is dark indeed.
[Source: Gasgoo via Autoblog]