Ssangyong Motor cuts 2008 sales target by 44%

The South Korean affiliate of China's Shanghai Automotive Industry Corp. (SAIC), slashed its 2008 sales target by as much as 43.6 per cent amid poor sales, union officials said Tuesday.
 
In addition, Ssangyong and its union have been in talks to cut 474 workers, or about 10 percent of its total workforce, according to the union officials.

Ssangyong had planned to sell 141,800 vehicles at home and overseas this year, but that target was reduced to as low as 80,000 units, the Ssangyong union said in a statement.

In the statement, the union strongly accused the SAIC of passing responsibility for its management failure to South Korean workers.

It called on workers to "wage a battle to nullify Shanghai's capital restructuring plan," referring to the Chinese parent company SAIC.

In the first nine months of this year, Ssangyong's vehicle sales plunged 30.2 per cent to 66,793 units.

Ssangyong, South Korea's smallest automaker, has been hit especially hard by high gas prices from the beginning of this year due to its line-up, which is dominated by gas-guzzling sport-utility vehicles and large-size sedans.

Ssangyong Motor Chief Executive Officer Choi Hyung-tak is on course to fall short of the company's annual profit and sales targets this year, as the automaker posted a net loss of 69.9 billion won (US$54.7 million) on sales of 1.32 trillion won. First-half revenues fell 18.6 per cent from a year earlier.

Amid dwindling sales, Ssangyong shut down its sole auto assembly plant in Pyeongtaek, about 65 kilometers south of Seoul, from July 31 to Aug. 17, to cut down on inventory.

The 18-day shutdown cost up to 2.2 trillion won in lost production, the automaker said earlier.

Officials at Ssangyong's public relations team weren't immediately available for comment.