UPDATE: SsangYong is now under court receivership (4/16).
SsangYong may have found a savior through a very unlikely source: Chery Auto. That’s assuming of course, Chery’s U.S. distributor, HAAH Automotive Holdings pushes through with their supposed plan.
Korean media have reported that U.S.-based HAAH Automotive Holdings planned to make a USD 250 million investment in the struggling SsangYong. This was after SsangYong’s biggest shareholder, India’s Mahindra said it was unwinding its stake in the automaker, and won’t be investing any more money.
However, the March 31 deadline has come and gone, and the Seoul Bankruptcy Court still hasn’t received a letter of intent. With that, the court is expected to begin its debt rescheduling process for SsangYong as early as this week.
For failing to find an investor, SsangYong Motor CEO Yea Byung-tae resigned last week in a letter addressed to its 5,000 employees.
But, where does the Chery connection come in?
Well, according to Automotive News, HAAH could potentially use SsangYong’s plant as means to sidestep the stiff U.S. tariffs on Chinese goods.
Since Korea and the U.S. have a free-trade agreement, it could use SsangYong to assemble Vantas and T-GO—the two brands that Chery will go by in the U.S., while also giving HAAH a possible third brand to import in the near future.
Having said that, HAAH could import its first batch of vehicles directly from China, and simply absorb the cost of tariffs on them.
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