SOUTH KOREA: Ssangyong mulls shutdown on high inventory
Ssangyong Motor Co has said it is considering temporarily shutting down to reduce its inventories, according to a press report yesterday (6 December).
In a statement, the South Korean SUV maker said: "We have considered closing (production lines) to adjust our inventory level, but a final decision has not been made as of December 5."
Ssangyong is hoping to reduce its inventory level by 50% to around 4,000 vehicles by the end of the year.
According to news agency Reuters, the company has come under pressure on its domestic market from the successes of larger rivals, such as Hyundai Motor Co. and Kia Motors Corp.
Although Ssangyong's overall vehicle sales rose 18% in November, compared to the same period last year, its sales in South Korea grew only 2%.
It is feared the company may run into trouble with its unions over a decision to close. Under South Korean law, union agreement is required to completely halt operations and the company has indicated that initial talks with the union had not been positive.
If union approval is not forthcoming, Ssangyong said it will attempt to reduce inventories by halting operations on individual production lines.