Wednesday, January 17, 2001
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Posted on: Wednesday, January 17, 2001

Daewoo's layoff plans spur walkout

Associated Press

SEOUL, South Korea — Thousands of workers at troubled Daewoo Motor Co.’s main assembly lines walked off their jobs for four hours yesterday to protest layoff plans.

About 6,500 unionized workers at Daewoo’s main plant in Bupyong, 18 miles west of Seoul, walked off their jobs at noon, said Choi Jong-hak, a spokesman for Daewoo Motor union.

"We will hold a meeting of rank-and-file members soon. There, we will determine our plans for further strikes," Choi said.

"Layoffs as part of restructuring is a matter both sides should discuss, not an excuse to strike. We will sternly deal with it," said Lee Chang-won, a spokesman for Daewoo Motor, South Korea’s third-largest automaker.

Lee said a half-day stoppage at Bupyong plant would cause a production loss of 125 passenger cars worth $1 million.

Daewoo Motor workers staged a two-month long strike early last year to oppose a plan by creditors to sell the company to a foreign investor, fearing it would lead to mass layoffs. The carmaker went bankrupt in November with an estimated debt of $10 billion and creditors have been trying to find a buyer.

Daewoo’s labor union then accepted layoffs as part of the company’s restructuring program on condition that management would consult with the union first.

In late December, however, management unilaterally announced plans to lay off 5,498 workers to improve the terms of the company’s possible sale to General Motors Corp.

After 2,704 workers quit voluntarily, creditors announced plans to lay off 2,794 more workers, or 22 percent of the total work force of 12,844, by Feb. 16.

Daewoo Motor is capable of producing 2 million vehicles a year. The company could be valuable to foreign carmakers seeking entry to South Korea’s virtually closed car market and a stepping stone into nearby China, one of Asia’s fastest growing car markets.

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