Korea Daewoo Motor plans to cut 6,884 jobs December 29, 2000

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SEOUL, Dec 29 (Reuters) via NewsEdge Corporation -

South Korea's bankrupt Daewoo Motor said on Friday it planned to lay off 6,884 workers, or 32 percent of its workforce, through restructuring.

The country's third largest automaker, whose court receivership application was approved in November, said in a statement it aimed to save 234 billion won ($186.9 million) a year from job and wage cuts.

The company said the job-cut plan would be discussed with the company's 13,000-member union, 60 percent of its total workforce of 21,789 which includes temporary workers.

``Management and the union have started talks on the job-reduction plan,'' a spokesman said.

Union officials were not available for comment.

Those who will be cut comprise 5,494 factory workers and 1,390 white-collar employees, the company spokesman said.

Since the plan started since November, a total of 2,028 workers had volunteered to quit as of Thursday, he added.

Daewoo Motor union abandoned its objections to any reform plan calling for job cuts after creditors refused to give fresh loans and the court threatened to liquidate the automaker unless the union accepted a layoff plan.

Creditors of Daewoo Motor agreed early in December to provide 727.9 billion won in fresh loans by the first half of 2001 to help the sale of the automaker to General Motors and partner Fiat.

Progress on the sale negotiation has been slow.

The company has said it was losing 100 billion won a month and reported a loss of 1.42 trillion won on sales of 4.66 trillion in the first nine months of this year. Its interest-bearing debt burden was estimated at $7.45 billion as of June 30.

($1 -1,252 won)

-- Martin Thompson (mthom1927@aol.com), December 29, 2000

Answers

GM is still planning on buying Daewoo Motors? After it's GM plans on nixing Oldmobile and the layoffs in UK? This is insane! Maybe they want the smaller cars and the cheaper production, more squeeze on the American workers. Welcome to the global economy, hope you enjoy your service sector job -- "trading the blue collar for the greasy collar" &cop (c)2000.

-- (perry@ofuzzy1.com), December 29, 2000.