Korean brand SsangYong has announced it is bouncing back from two years in financially imposed hiatus with a new board, new capital and distribution partnerships. The company also has a new compact SUV, the Korando C, set for release in Australia later this year.
In launching its new assault on the local market, it has an important and influential ally in Malaysian-based Sime Darby, one of the world's biggest automotive importers and distributors. In Australia, Sime's main wholesale concern is Peugeot.
Long considered something of an oddball in the local auto market, Korea's oldest auto maker has made barely a ripple in the auto media in recent years. That's because it's been in deep trouble at home. It began as the GFC set in, in 2008. The company's majority shareholder, Shanghai Automotive Industry Corporation (SAIC), pulled the funding plug, sending the company to the wall in November that year -- just a couple of weeks after Sime signed a deal with the company to distribute its product in Australia.
By January 2009, caught between the irresistible force of labour reform imperatives and the immovable object of an intransigent union movement, the SsangYong board threw in the towel and placed the company in the control of the government and the South Korean Court of Receivership. A new board was appointed, triggering a major brawl with the unions and a 77-day strike that extended to street violence. With government backing, the company held out and eventually won the reforms it needed to survive, but it took until December for the Court to accept the company's rehabilitation strategy and set it on track to find a new partner to replace SAIC. The company will be announcing that partner's identity on July 20. Among the applicants are Indian giant Mahindra and a joint venture between the Nissan Renault Alliance and Samsung.
Despite the terrible timing of the 2008 deal, Sime decided to stick with SsangYong, a decision the distributor's local CEO, Rob Dommerson, put down to a combination of his company's deep pockets and the brand's promising value proposition. "More so with the Korando C. It'll stack up well in its segment -- certainly anything coming out of Korea."
SsangYong has expressed its confidence about the product and short-term future with projections of a fourfold production increase, from a total 60,000 units across its lineup in 2010 to 250,000 in 2011.
Mr Dommerson and sales and marketing manager Steven Thomas put Sime's faith down to a number of factors: a strong and loyal core dealer network, even as times got tough; the resolution of supply issues, particularly with the July announcement; value for money and the marketing possibilities of a 100 pc diesel strategy.
In keeping with the latter, the Korando C will come with a "European sourced" 2.0-litre oiler and put its power to the road through a choice of six-speed manual or an Australian-made DSI six-speed auto. Its people remain coy about the source of the engine, at least until the July 20 announcement, after which every aspect of the deal is locked in. The company doesn't want to repeat its 1990s experience, when it incurred the wrath of Daimler by focusing press and consumer attention on the Mercedes-Benz six under the bonnet of its Musso SUV.
Thanks to: Car Point
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