Shanghai Automotive Industry Corp. (SAIC) announced yesterday that it was intensifying its efforts to end strike action which began on 11 August at its South Korean SUV subsidiary Ssangyong in protest against alleged technology transfer to China and 1,000 planned job cuts. SAIC increased its stake in Ssangyong to 51.33% last year, and this year announced plans to invest $2.5bn over five years to expand its capacity.
Analysts in South Korea estimate that Ssangyong has so far lost 10,000 units of production due to the dispute. While SAIC does not directly manage its Korean acquisition, it recently engaged former GM boss in China Phil Murtaugh to represent its interests with Ssangyong's local management. Ssangyong's new representative director to monitor the South Korean firm on behalf of SAIC.
SAIC and Ssangyong also signed an agreement earlier this year that will see SAIC use Ssangyong's engine technologies and design capacity to develop its own vehicles, scheduled to hit the market by 2008.
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