Daewoo Motor will lay off 3,500 in 2001

Daewoo Motor announced a restructuring plan that calls for reducing 900 billion won in overall costs during 2001 through the layoff of 3,500 workers, salary cuts and sale of overseas subsidiaries.

Under the plan, Daewoo will cut 420 billion won by lowering the purchasing prices for parts and components, manpower reduction and salary cuts, while lowering the sales commission offered to Daewoo Auto Sales.

Also, the company will sell its 24.99% ownership in Korea Delphi to Delphi and sell real estate to raise 100 billion won, and it will reduce the number of its overseas subsidiaries.

By the year¡¯s end, the company will suspend overtime, expand suspension of operations, relocate about 1,000 workers and use annual or monthly leave as part of the restructuring plan.

Overseas subsidiaries also will go through restructuring and will be operated as an independent unit. By doing so, unprofitable operations will be withdrawn or liquidated if they cannot be sold.

Besides, the company will unify the platforms of car models and develop strategic models. Development of new models will focus only on the Lanos.

Ha Im-Sook artemes@donga.com