SAIC: No $1 Bln Investment Pledge To Ssangyong
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Ssangyong's union leaders, members of the Democratic Labor Party and some civic activists held a rally in front of the Chinese Embassy in Seoul on Tuesday, demanding that the company's Chinese management pay for technology transfers and make the $1 billion investment it promised.
Zhu Xiangjun, a spokesperson for SAIC, told reporters that SAIC had never promised to invest $1 billion into its South Korea unit, while only once said "it would seek funds through various channels to acquire Ssangyong."
"The $1 billion fund promise came from another Chinese automaker who once made a bid for Ssangyong in competition with SAIC, but Sangyong union has shift the responsibility onto SAIC instead," Zhu said.
"The claim of SAIC plagiarizing diesel engine technology from Ssangyong is also absurd because SAIC is developing its own hybrid vehicles independently," he added.
On Friday, Ssangyong filed for court protection to avoid bankruptcy while struggling with a slump in car sales and liquidity problems. That would mean SAIC may lose its entire stakes in Ssangyong and relinquish its management control, the media said.
The Chinese auto giant SAIC said in a statement that the value of its holding in Sssangyong was 1.85 billion yuan at the end of November by Chinese accounting standards.
An editorial article from The Korea Herald said union members need to remember that the Chinese took over Ssangyong when no Korean firms wanted it. This is the reason they still have their jobs. The article further advises that if the industry wants to keep alive, they should be on guard against any nationalist sentiments to interfere.
SAIC paid $500 million for a 49 percent stake of the South Korean automaker in 2004, and it invested $45 million in Ssangyong at the end of December.
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