UK Daewoo battles on

Daewoo cars build up in South Korea

Daewoo has assured its workers and customers in the UK that it will be "business as usual", even though the Seoul-based conglomerate has been declared insolvent.

I am asking the Secretary of State for Trade and Industry to intervene

Roger Lyons
MSF union

Unions support plans by the South Korean company to sell its technical centre in Worthing, West Sussex, where about 500 people are employed.

The high-tech centre is understood to have attracted interest from at least two potential buyers.

An additional 1,200 jobs are at stake in the UK dealer network.

Daewoo says it is involved in complex restructuring but that customers "can be confident that their warranties and service packages will be honoured".

UK Prime Minister Tony Blair told MPs the Government would do everything it could to secure the future of the Worthing factory.

He said Britain's ambassador in Seoul was already talking to the authorities there about the bankruptcy.

'Self-sufficient'

In a statement, the company said: "Daewoo Cars is a self-sufficient subsidiary that does not rely on funds from Korea.

"For both the sales network and the Worthing technical centre it is business as usual."

Daewoo is hoping that the insolvency will remove obstacles in takeover talks with General Motors.

But it said no further details were expected from General Motors for at least a month.

Sale opportunity

The Manufacturing, Science and Finance union said it believed the insolvency could be a "golden opportunity" for the Worthing site to be sold off separately.

Its general secretary, Roger Lyons, said: "We are holding talks with Daewoo to see if there is anything we can do to help.

"I am asking the Secretary of State for Trade and Industry to intervene, to allow a breathing space for negotiations with potential buyers."

Workers at the Worthing centre have endured months of uncertainty, redundancies and non-payment of wages as Daewoo has struggled to survive.

Daewoo in the UK has been telling worried customers telephoning its helpline that its car division remains in profit and they need not be concerned.