Debt-ridden Ssangyong to sell car plant in self-rescue drive

Ssangyong Motor Co., the debt-ridden South Korean unit of India’s Mahindra and Mahindra Ltd. now in court receivership, has decided to sell its sole car factory in Pyeongtaek as part of its self-rescue efforts.

The move is expected to speed up the process of finding a new owner as the disposal will help the SUV maker pay back some of its loans.

Ssangyong said on July 11 it signed a memorandum of understanding with the Pyeongtaek government regarding the sale of the 42-year-old plant, which is valued at some 900 billion won ($785.3 million). With the proceeds, the company will build a factory to produce future vehicles such as EVs and self-driving cars.

“The Pyeongtaek plant relocation is part of securing mid- to long-term competitiveness for Ssangyong Motor’s future,” said Chung Yong-won, the court-appointed manager for Ssangyong. “It will complete development of six eco-friendly models including a dedicated EV in 2026.”

Ssangyong is currently producing seven SUVs including the Korando Emotion, its first EV, which will be exported to Europe in October.

The company on June 28 announced an auction for its majority stake after Mahindra failed to find a new investor. The company has been under court receivership since April.

Write to Hyung-Kyu Kim at khk@hankyung.com
Jongwoo Cheon edited this article.