SAIC plans to cut 2,000 jobs at Ssangyong Motor

Shanghai Automotive Industry Corp. (SAIC) plans to cut up to 2,000 jobs at the troubled Korean carmaker Ssangyong Motor Co., local media reported quoting Chinese sources yesterday.

Ssangyong Motor officials in Seoul said yesterday evening that any measures had not yet been finalized and that the reports were based on speculations. The actual results of the SAIC board of directors' meeting will be announced today, they said.

SAIC, the majority shareholder of Ssangyong Motor, held a board of directors meeting in Shanghai yesterday to draw up reform plans for Ssangyong Motor.

According to local news reports quoting the Chinese portal site Sina.com, SAIC is said to be maintaining the position that it would inject cash only if Ssangyong Motor implements severe restructuring.

According to the reports, SAIC has offered to provide Ssangyong Motor with $200 million if the Korean carmaker cuts 2,000 jobs.

Reports added that the Chinese company estimates that $200 million will only keep Ssangyong Motor afloat for only six months unless drastic restructuring measures are implemented.

Ssangyong Motor's labor union is maintaining its original position that it will not comply with any restructuring measures.

The union has threatened to take industrial action in protest of restructuring and alleged technology theft by the Chinese conglomerate. Although the union voted on the issue on Monday and Tuesday, it is withholding announcement of the result of the vote until after SAIC's plans are announced.