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February 5, 2021

Ssangyong suspends production due to supplier non payment

SsangYong Motor said on Friday it would extend the suspension of its local plant due to a lack of parts supplies from contractors.

By Olly Wehring

SsangYong Motor said on Friday it would extend the suspension of its local plant due to a lack of parts supplies from contractors.

The financially troubled automaker has already halted its plant in Pyeongtaek on 24 and 28 December and 3-5 February as its suppliers refused to deliver parts due to outstanding payments, a Yonhap report in the Korea Herald said.

The SUV-focused carmaker filed for court receivership on 21 December after it failed to obtain approval for the rollover of existing loans from its creditors.

SsangYong received a two-month suspension of its obligation to pay its debts as it aims to find a new investor during the period before the court-led restructuring begins on 28 February, the report said. The suspension period can be extended depending on the court’s decision.

Parent Mahindra & Mahindra is in the process of selling its controlling stake in the Korean unit, denying reports the deal has fallen through.

Mahindra acquired a 70% stake in SsangYong for KRW523bn in 2011 and now holds a 74.65% stake in the carmaker.

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