Russian Automaker Aiming to Buy SsangYong Rights

Russian automaker Sollers today said it is interested in acquiring SsangYong production rights to manufacture sport utility vehicles for the domestic market. SsangYong filled for bankruptcy protection in December 2008 after loses caused by the economic recession made payments to dealers, suppliers and workers impossible. Even though it's not yet clear if SsangYong's plans to inject more money into the South Korean carmaker, problems are far from being over as the workers' union of workers authorized a strike in case it's necessary.

"Our members approved a strike, but we will be very careful on launching an action as many of our suppliers are facing risks of bankruptcy," union spokesman Lee Chang-kun was quoted as saying by Reuters.

However, Sollers tries to take advantage of SsangYong's ambiguous situation and says it's ready to discuss a potential deal, without mentioning how much it is willing to pay for the rights.

“The company is ready to buy the rights to produce SsangYong models... as well as to take over their components base. This move would allow Sollers to continue manufacturing SsangYong models in Russia completely independently of the Korean company,” the Russian automaker said in a press statement quoted by Reuters.

The Russian company is already holding a license to manufacture SsangYong's Kyron and Rexton II models for the domestic market, the aforementioned source reported, with approximately 16,000 models sold in 2008.

In addition, the company announced last October that sales of new SsangYong C200 crossover are expected to start in late 2009. “Investment in the model production, taking into consideration necessity of new welding equipment installation, may amount to 5-6 million US dollars, and the production capacity is about 35 thousand vehicles a year, as C200 will be positioned in the most popular compact city crossover class,” an October 2008 statement read.
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About the author: Bogdan Popa
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Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
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