Ssangyong Motor issues ultimatum against striking workers

Battered Ssangyong Motor Co. issued an ultimatum Wednesday urging its striking workers occupying the carmaker's only plant to disperse by early next week or it will ask police to end the occupation.

Thousands of unionized workers at Ssangyong have occupied the carmaker's sole plant in the city of Pyeongtaek, 70 km south of Seoul, since May 21, staging a sit-in to protest a massive job-cut plan. In response, Ssangyong has closed the Pyeongtaek factory.

Ssangyong, which has been under court receivership since February, plans to cut 36 percent of its workforce, or 2,646 workers, as part of its survival bid.

"Unless striking workers disperse voluntarily by Monday, we will take all possible legal actions," said Lee Yoo-il, one of the two court-appointed managers supervising the automaker's bankruptcy process.

"The workforce restructuring is essential to Ssangyong's survival," Lee said.

He warned that Ssangyong will ask police to end the occupation unless striking workers end their sit-in protest by Monday.

"If the strike continues, the bankruptcy court won't approve our survival plan," Lee said. "In that case, Ssangyong will be liquidated quickly."

Prospects, however, for resolving the labor standoff at Ssangyong were dim as the striking workers have pledged to stage a "do-or-die battle" against the company's job-cut plan.

Last month, the Seoul Central District Court said saving Ssangyong is more valuable than liquidating it, but warned it could still force the ailing carmaker to close down if it fails to make the job cuts as promised.

In the first three months of this year, Ssangyong posted its sixth straight quarterly net loss.

Ssangyong posted a net loss of 265 billion won (US$213.8 million) in the first quarter, compared with a loss of 34 billion won for the same period last year. First-quarter sales plunged 66 percent from a year ago to 234 billion won.

Recent numbers also showed that the free fall in sales of Ssangyong vehicles isn't over as consumers shun buying cars from the potentially bankrupt company.

Last month, Ssangyong's auto sales plummeted 60 percent to 2,868 units, compared with a 58 percent plunge in April.

Related terms: bankruptcy, legal, plant, police, protest, restructuring, sales