The outlook for the court-managed Daewoo remains clouded by the persistent foot-dragging of General Motors, the sole negotiating party for takeover, as well as a looming labour dispute over the scope of layoffs, the Korea Herald said on Tuesday (5/12/00).

GM Korea president David Jerome was quoted as saying: "The acquisition of Daewoo Motor is still part of GM's global strategy. Announcement will be made at an opportune moment later, depending on the progress of negotiations."

One of his aides said that GM plans to make an official announcement on Daewoo at the Detroit Motor Show early next year.

"GM president Rick Wagoner will hold a conference with the Korean press at the Detroit Motor Show, due to open January 6, to unveil its takeover strategy for Daewoo," the aide said, asking to remain anonymous.

"GM [remains willing] to buy Daewoo Motor. However, it is improper to reveal the concrete takeover strategies now."

GM on Monday signed a joint research and development project with Seoul National University and two other institutions.

Industry analysts speculated that GM's R&D projects are in line with its efforts to cut the takeover price by shifting the focus of negotiations to technology transfer and other qualitative factors.

"As the Seoul government is already hinting at split sales for Daewoo at a steep discount, GM, taking advantage of its status as the sole bidder, is expected to continue its foot-dragging strategy early next year," industry analyst Rho Hyo-dong told the Korea Herald.

"In that sense, GM is likely to come to the negotiating table only after Daewoo implements sweeping restructuring, including layoffs."

In the first round of bidding, won by Ford Motor, GM was reported to have offered 2 trillion won to 4 trillion won for Daewoo. It is now reportedly aiming to buy Daewoo for less than 1 trillion won.

Apart from Daewoo's dimming outlook, affiliate Ssangyong Motor's independent move to negotiate takeover with DaimlerChrysler will likely turn out to be turbulent in the face of the German-U.S. automaker's internal financial troubles, the analysts told the newspaper.

As part of its stand-alone move, Ssangyong cut its marketing ties with Daewoo Motor Sale last week, while its creditor Cho Hong Bank said that it will contact DC after confirming GM's stance on Ssangyong.

Meanwhile, Daewoo's Pupyong plant produced 750 passenger cars, including 450 Lanos compacts, the first in some time, and plans to build out a total of 11,440 units this month.