Autonomous cars: Will they ever happen? - Full cast special: CarsGuide Podcast #200
Episode 200 - Autonomous cars: Will they ever happen? - Full cast special
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It’s far from over for SsangYong, as two more large local Korean conglomerates have joined the bidding for the embattled automaker.
The two big groups, SM Group and a consortium led by Edison Motors, join a total of nine potential new owners, with many also tipping the US-based Cardinal One Motors as a leading player.
SM Group is Korea’s 38th largest corporate entity, with assets in the chemical, construction, shipping and broadcasting industries.
It is hailed as a leading bidder, as it already produces vehicle parts through its subsidiary, Namsun Aluminium. According to The Korea Times, the SM Group has been looking to grow through investment in the electric vehicle market, which SsangYong claims to be well positioned for.
An SM Group executive told Korean media that unlike some of its rivals, it had the cash reserves to finance the acquisition and would need no outside financial backing. SM Group has previously bid for SsangYong before when it was offloaded by China’s SAIC Motor during the GFC. It lost in bidding to Indian corporate giant Mahindra and Mahindra, but continues to view the brand as a way of diversifying.
Meanwhile, Edison Motors is a manufacturer of commercial vehicles specialising in the bus industry. Since 1998, the company has built compressed natural gas (CNG) and regular combustion buses, and now fields its own battery-electric buses throughout Korea, which have 378km of driving range.
Edison Motor has had its eye on expanding to the electric passenger vehicle market and views the EV-ready SsangYong as a way of fast-tracking its entry to the field. It has formed a consortium with a private equity fund and others to help fund the acquisition.
As announced two weeks ago, one of the earliest and leading bidders for SsangYong is the US-based Capital One Motors. Raising funding from dealer groups throughout the US, Capital One has risen from the ashes of HAAH Automotive Holdings, which recently filed for bankruptcy in a failed bid to import knock down kits of Chery vehicles to the US. It had also previously planned to make a bid for SsangYong.
Its directors said HAAH failed due to brutal tariffs on Chinese imports imposed by the Trump administration. It hopes to offer SsangYong access to the lucrative US market, as it shares a free-trade agreement with South Korea. It is unlikely Capital One will raise the funding to acquire SsangYong without assistance from the Korean Development Bank.
According to Korean media, the sheer number of bidders for SsangYong came as a surprise, with the brand’s decision to sell its ancestral factory of 42 years in the city of Pyongtaek apparently proving popular with potential investors. The brand claims the move out of its old facility will help finance the construction of a new facility on the outskirts of the same city, allowing it to maintain its workforce whilst modernising its facilities for its future electric line-up.
SsangYong is due to release its first EV, the Korando e-Motion, before the end of the year in Europe, and has unveiled its future direction lies in tough retro-styled electrified models, as previewed by the recent J100 and KR10 concepts.
The leading investors for SsangYong will submit bids for the brand in September, with the brand’s court-appointed advisor aiming to have the sale (and SsangYong’s future) confirmed by November.