SEOUL: South Korea’s top financial regulator said Tuesday the government will swiftly proceed with negotiations with General Motors Co. on a turnaround plan, including the government’s potential support measures, for the U.S. carmaker’s troubled local unit.
Choi Jong-ku, chairman of the Financial Services Commission, told lawmakers that due diligence on GM Korea will be conducted without delay.
Earlier this month, GM, which asked the Korean government to provide financial support for GM Korea, said it will close one of its plants in South Korea by May and the fate of its remaining three plants here will be decided within weeks.
he Korean government has set out three principles for talks with GM. They include “responsible roles” for GM and all stakeholders, including GM Korea’s labor union, and a “long-term and viable” plan to get the carmaker back on its feet.
“In line with these principles, the government will conduct due diligence (on GM Korea) without setbacks and swiftly proceed with GM on a normalization plan for GM Korea, including the government’s potential support measures,” Choi told lawmakers.
If GM and GM Korea’s labor union want help from the Korean government, Choi said they should “share the pain.”
Choi did not specifically comment on what steps the two sides should take, but local media reports said GM needs to convert GM Korea’s debt into equity and allow the Korean unit to produce new models.
