Ailing Daewoo Motor Co. said Monday it
plans to eliminate 6,500 of the 46,000 jobs at its overseas
production and sales units within this year.
The move is in line with the restructuring program of Daewoo,
Korea's third biggest automaker which is trying to make itself more
attractive for a takeover by U.S. auto giant General Motors Corp.
Daewoo has cut its domestic work force by more than 30 percent to
10,000 in the past year.
"The restructuring is inevitable for Daewoo to slim down and
survive," said Kim Sang-soo, a Daewoo spokesman. "The job cuts
will be pushed at all 15 overseas production and 31 sales units."
The manpower reduction came on the heels of the company's recent
decision under which four Daewoo units in Japan, Hong Kong,
Thailand and Myanmar were liquidated or spun off.
Daewoo also said its Polish passenger car unit, FSO, and its
Indian unit, DMIL, are aggressively implementing restructuring
moves but declined to disclose details.
It said, however, that creditors of those Polish and Indian
units will be allowed to make debt-for-equity swaps if they so
As part of its restructuring, FSO has recently agreed with the
Polish government and its union on a plan to slash 1,294 employees,
or 26.2 percent of its entire 4,943-member workforce, while the
Indian unit has cut 865 of its 2,880 jobs.
Daewoo has a capacity of 1 million cars in plants at home and
800,000 in plants abroad.
Meanwhile, South Korea's Pohang Iron and Steel Co. denied a
report Monday by the national Yonhap news agency that it was
considering a takeover of Daewoo Motor.
"The report is simply not true," said Lee Sang-choon, a
spokesman for the steel giant.
Daewoo Motor collapsed during the 1997-98 Asian economic crisis.
Its domestic operations are now under court receivership with an
estimated debt of $15 billion.