Campaign to turn Daewoo Motor 'people's firm'
Campaign to turn Daewoo Motor 'people's firm'
SEOUL (AFP): Former South Korean prime ministers and academics
launched a campaign Tuesday to turn bankrupt Daewoo Motor Co.
into a "people's company."
Ahead of the temporary closure of the carmaker's main plant,
300 prominent figures, including former government officials,
college deans, and religious leaders vowed to transform Daewoo
Motor into a company financed and run by citizens.
"We, all of us, are responsible for Daewoo Motor's problems.
The company must be reborn as a competitive people's company,"
former vice prime minister Choi Gak-Kyu said in a statement.
Choi said the group would stage rallies from March 2 to the
end of July aiming to raise one trillion won (US$794 million) in
public donations.
The money would be used to buy Daewoo Motor shares, he said,
expressing doubts about a government bid to sell the company to
U.S. auto giant General Motors Corp. (GM) and its Italian partner
Fiat SpA.
The Hankyoreh newspaper, a former dissident publication, has
been run as a so-called "people's company" since 1988. But union
leaders and experts have expressed skepticism about the
possibilities of Daewoo Motor following the same route.
After Ford Motor Co. pulled out of a 6.9 billion dollar
takeover bid last September, GM investigated Daewoo Motor's
finances but has since made no further announcement.
Creditors contend GM is still interested in Daewoo Motor. But
industry analysts have doubts.
The civic campaign came one day after Daewoo Motor announced
it would close its main plant in the western city of Inchon for
three weeks from next Monday due to slumping sales.
Daewoo officials said the closure was aimed at reducing costs
and inventories. Sales in January fell 51.9 percent from a year
earlier to 38,710 units, with inventory levels amounting to one
month's orders.
Daewoo Motor was declared bankrupt three months ago. It plans
to lay off 1,918 production workers starting February 16 as part
of its efforts to slash 6,884 jobs, or a third of its workforce.
Its annual production capacity includes 1.06 million vehicles
in South Korea and 875,000 in overseas plants in Poland, Romania,
the Czech Republic, Uzbekistan, Ukraine, India, Iran, Libya,
Vietnam, China and Egypt.
On Monday, Daewoo Motor's plant in Poland announced a plan to
slash a quarter of its workforce or up to 1,300 jobs.
Creditor banks have pushed for drastic cost-cutting to
accelerate the deal with GM. But unions have staged a wave of
strikes to oppose job losses, insisting Daewoo Motor should be
nationalized.
"We welcome the campaign. But our goal is to nationalize the
company," union spokesman Choi Jong-Hak said.
He threatened to counter the planned plant closure with an all
out strike.