Shanghai Automotive Industry Corp, which makes cars in China with Volkswagen AG and General Motors Corp, said it has invested about 30 percent of the US$1 billion it promised to spend for South Korean unit Ssangyong Motor Co.
"The 300 billion won is part of the US$1 billion, " Jiang Zhiwei, vice-president of Shanghai Auto told reporters in Seoul yesterday.
Ssangyong Motor, producer of the Kyron sports-utility vehicle, is the second-smallest of South Korea's five car manufacturers.
Shanghai Auto, China's second-largest carmaker, paid US$500 million for a 48.9 percent stake in Ssangyong Motor in October last year and has pledged to invest US$1 billion to develop vehicles with Ssangyong Motor, based in Pyeongtaek city, outside of the capital.
Shanghai Auto is planning to add a production line to build its first vehicle, without its two overseas partners, based on Ssangyong Motor's Kyron vehicle, documents obtained by Bloomberg last week showed. Ssangyong Motor's union, representing half of the carmaker's 10,000 workers, is opposed to the plan and is threatening to stage a strike, adding Shanghai Auto should make the US$1 billion investment it promised.
Some of the 300 billion won investment went into producing the Kyron and Actyon vehicles, Ssangyong Motor's newly appointed president Choi Hyung Tak, 58, said in a briefing on Sunday.
Part of the amount was spent for Ssangyong Motor's bid to develop a new diesel engine in two to three years, Choi said.
On Saturday Shanghai Auto named Choi as the new Ssangyong Motor's president, replacing Soh Jin Kwan.
(China Daily November 8, 2005)