Recovery in GM-Daewoo's key UK and German markets has been very slow, according to company president Nick Reilly, because the distribution channels in Europe's two largest markets had gone and had to be rebuilt.

He predicted that sales in Europe would climb to 150,000, up from 100,000 last year, rising to close to 200,000 by the end of 2004. But GM Daewoo will not see a real increase in its European sales until a new family of diesel engines, some of which are expected to be sourced from sister GM company Opel, come on stream in 2005, said Reilly.

This was one of the major benefits of being part of GM. "We don't have to reinvent everything. We can get technology from within GM and then localise it to take advantage of the cost base," Reilly said.

Reilly added that his priority now was to stabilise the company and rebuild morale, a task will be helped by the hiring of 2,500 extra people in Korea and now that two of four plants have gone back to two shift working from single shifts.

"We're investing in R&D and design where 300 extra people have been taken on and we have just finalised our annual wage negotiations without any industrial unrest which is unusual in South Korea," said Reilly.

Global sales were well balanced with 2004 forecasts of 600,000 split fairly evenly between the Far East, North America and Europe. In 2002, worldwide sales were just 350,000.

"Our target is a million sales a year, but that is some four years away," said Reilly.