Yonhap - Ssangyong Motor Co., Korea's smallest automaker, is set to re-enter the Chinese market, company officials said yesterday.
Ssangyong Motor began exporting sports utility vehicles to the neighboring country in 2006, but shipments were halted after the automaker was placed under court bankruptcy protection in February 2009.
The company said it opened its Chinese headquarters in Shanghai this week and will start selling its Korean-made cars in China next month, officials at the Shanghai office said. The company also plans to set up its Beijing office in a few years.
Ssangyong is currently in talks with two major car distributors in China. The company, however, did not disclose the name of the distributors.
Last November, Ssangyong Motor agreed to sell its majority stake worth 520 billion won ($460 million) to the Indian utility vehicle maker Mahindra and Mahindra Ltd.
Ssangyong, which produced Korea's longest surviving sports utility vehicle model, Korando, was sold in 2004 to China's top automaker Shanghai Automotive Industry Corp.
The former Chinese parent company, however, abandoned Ssangyong in January 2009 in the wake of the global financial crisis.
Boosted by the government's tax breaks to buoy domestic demand amid the economic slowdown, China overtook the U.S. as the world’s largest automobile market in 2009.
In 2010, 18.1 million vehicles, including passenger cars, trucks and buses, were sold in China, up 32.4 percent from the previous year, according to the industry group China Association of Automobile Manufacturers.
Many market analysts expect that China's automobile sales will see slower growth this year, as the government stopped offering incentives and introduced new limits on car purchases,
The association predicted that the annual growth rate of auto sales will stay at an average of 10 percent from 2011 through 2015, compared with more than 30 percent in 2009 and 2010. Meanwhile, Hyundai Motor and Kia Motors, the only Korean auto manufacturers that have production lines in China, held a combined 7.5 percent of the Chinese auto market last year, selling more than 1 million units. They ranked fourth after Chinese, Japanese and American auto makers.
