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November 16, 2005

SOUTH KOREA: Parent’s financial woes not hampering GM unit

General Motors’ financial woes will not hamper its South Korean unit, the head of GM Daewoo Automotive & Technology reportedly said on Wednesday.

General Motors’ financial woes will not hamper its South Korean unit, the head of GM Daewoo Automotive & Technology reportedly said on Wednesday.

A solid South Korean business is one of few bright spots for the world’s largest auto maker, which is haemorrhaging money at its core North American operations, Reuters said.

“We are self-financing and we have credit lines if we need to grow on them,” GM Daewoo CEO Nick Reilly told the news agency.

“The problems in the United States are somewhat overblown and there’s a plan to get out of the problems … in the meantime it’s not affecting us,” Reilly reportedly told a news conference in Pusan to show off GM’s hydrogen fuel-cell vehicle.

According to Reuters, GM said it has not yet decided whether to extend a co-operation pact with Toyota in research on fuel-cell vehicles. The current pact expires in March.

“There has been a very good relationship, we’ll see how that develops in the future,” George Hansen, director in charge of GM’s fuel-cell commercialisation in Asia Pacific, told Reuters.

“We are planning and targeting to have fuel-cell technology developed by 2010,” Hansen reportedly said, adding fuel-cell cars should by then be able to compete on performance with traditional cars.

GM would work with the South Korean government to win policy support for the new technology, including tax breaks on fuel-cell cars, as well as to promote their use, he told Reuters, adding similar efforts had made progress in Japan.

Robust exports helped GM Daewoo post record monthly sales of 112,631 vehicles in October, up 41% on a year earlier, the news agency noted.

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