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SsangYong has announced plans to shutter its only vehicle assembly plant in South Korea, in a move which it claims will boost its long-term competitiveness and appeal to new buyers.
SsangYong has been embattled in the last few months, as it defaulted on loans to several financial institutions, and is in the process of being offloaded by its previous parent company, Indian giant Mahindra and Mahindra.
Mahindra’s lack of funding and poor sales figures, as well as local industrial action, has forced Korea’s number three local brand to idle half its workforce and consider drastic measures to stay afloat until it can find a buyer.
SsangYong has occupied the factory set for closure in the city of Pyongtaek for some 42 years. It has one other domestic plant in Changwon, although this facility is only equipped to manufacture powertrain components.
The brand says it will use the funds from the sale of its only body assembly plant to fund the construction of an all-new facility on more affordable land on the outskirts of the same city in order to maintain its local support and workforce. SsangYong told media this new factory would be dedicated to the construction of “eco-friendly” vehicles, as it has recently teased with the J100 off-road concept.
The brand’s social media profiles have also alluded to “an electric ute” in the works, using teaser images of the J100 concept sketches. It has gone on the record claiming it will have six “eco-friendly” models on sale by 2026.
SsangYong's executives hope the move to its new facility will be fast and allow it to continue building cars without interruption. It announced full-scale production of its its first fully electric car, the Korando e-Motion, only last month, which is set to hit the market internationally before the end of the year. It has promised its next EV will be released "sooner than expected", in order to dispel fears that its combustion-heavy range will dash its chances of finding investors.
Locally, SsangYong has been met with tough market conditions, struggling to find traction with its refreshed Musso ute, Rexton large SUV, and Korando mid-sizer despite positive reviews. For the month of June 2021, the brand was up 116 per cent year-on-year, but has only moved a total of 1421 units so far, eclipsed by Chinese upstarts, MG (19,544 units) and GWM (including Haval, 7564 units).
CarsGuide has reached out to SsangYong’s Australian arm for comment on whether the closure of the Pyongtaek facility will have implications for the brand’s stock of locally available models.