Ssangyong Motor "Production Halted for Three More Days Due to Supplier Parts Delivery Refusal"

[Asia Economy Reporter Ki-min Lee] Ssangyong Motor has decided to halt operations at its Pyeongtaek plant for three more days due to delivery refusals from its suppliers.

Ssangyong Motor announced on the 5th that vehicle production at the Pyeongtaek plant will be suspended from the 8th to the 10th. The company stated, "Production is being halted due to disruptions in procuring parts caused by suppliers refusing to deliver."

Earlier, Ssangyong Motor had closed the plant on December 24 and 28 last year, shortly after filing for corporate rehabilitation on December 21.

This was because foreign-affiliated and large corporation parts suppliers, as well as small and medium-sized subcontractors, stopped supplying parts demanding payment of outstanding balances. Ssangyong Motor had been purchasing parts daily with cash due to these suppliers refusing to extend delivery contracts.

When Ssangyong Motor failed to settle a 200 billion won promissory note maturing on the 29th of last month and postponed payment, these parts suppliers again stopped deliveries. As a result, Ssangyong Motor experienced production disruptions on the 1st and 2nd of this month and completely halted operations at the Pyeongtaek plant from the 3rd to the 5th.

Ssangyong Motor announced plans to resume production on the 16th, after the Lunar New Year holiday, but this remains uncertain. The shutdown period could be extended depending on negotiations with the parts suppliers.