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Tuesday, 13 February, 2001, 17:48 GMT
Daewoo more cuts
Daewoo shuts plant to restructure jobs and cut inventories
Massive job cuts for Korea worker have started
South Korea's bankrupt carmaker Daewoo has issued redundancy notices to 1750 workers at its main assembly line, Pupyong, west of the capital Seoul.

The job losses were forced on Daewoo by an order from Korean court receivers issued last Saturday demanding 6,000 jobs be cut internationally and 6,800 in Korea.

Last minute talks with unions failed to stop the lay-offs.

In the UK, 187 jobs, or 40% of the workforce, were retrenched at Daewoo's technical centre in Worthing, West Sussex, as part of the global restructuring.

Daewoo UK said it was "disappointed" but making "ongoing efforts" to secure the sale of its Worthing operations and that a skeleton staff of 250 would keep the plant operational.

Sales and servicing of Daewoo cars will not be affected by the cutbacks.

Auto workers stage protest at Korean plant
Korean workers protest against sale of company
Hope of a sale

UK sports car builder TWR Engineering, of Oxford, has been in talks with Daewoo about Worthing's future but would not comment on the job losses or how the talks have progressed.

"The union is deeply shocked by the news that a Korean court order will put 187 people out of a job", said a spokesman of the Manufacturing, Science and Finance (MSF) union.

"We have contacted the DTI and Foreign Office for diplomatic assistance to buy time for a speedy sale. Once the sale goes ahead, the fully function operation will need 500 more staff. Ironically, the workers made redundant could be back at work in a months time."

Korean workers fears confirmed

The cuts in Britain came on the same day as Daewoo shut its Pupyong plant in Korea for three weeks, in an attempt to cut its bulging inventory of unsold cars.

The union said the plant has been shut until 6 March so that Daewoo can keep workers out when they announce the redundancies.

No buyer yet

Daewoo collapsed in August 1999 with debts of $80bn (55bn) and was declared bankrupt three months ago.

Founder Kim Woo-Choong being sought by South Korea authorities
Kim Woo-Choong: On the run from authorities
The Financial Supervisory Commission in South Korea has asked prosecutors to seek arrest warrants for a number of former executives, including the founder Kim Woo-Choong, for accounting fraud. He has been on the run since 1999 and has been reported to be in Sudan.

Creditors and the government have been pushing for a radical reorganisation and cost cutting in preparation to sell the company.

US carmaker General Motors and its Italian partner Fiat have shown some interest but formal talks have not been announced. Analysts think the job cuts may help jump-start talks.

Last September, Ford Motors of the US pulled out of a $6.9bn (4.75bn) takeover after taking a close look at Daewoo's accounts.

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See also:

08 Feb 01 | Business
Vigilantes hunt Daewoo 'fraudster'
19 Dec 00 | Review
Collapse of the Korean chaebol
02 Feb 01 | Business
Daewoo corruption scandal deepens
27 Nov 00 | Business
Daewoo unions bow to pressure
08 Nov 00 | Business
Daewoo declared bankrupt
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