In July, 2007, China’s State-owned enterprise Shanghai Automobile Industry Corp. (SAIC) purchased Ssangyong Motor Company, a major auto manufacturer in South Korea. However, after the purchase SAIC, as the majority shareholder, refused to honor its obligations under the contract to retain employees and invest capital, which resulted in massive losses for Ssangyong. In the meantime , SAIC obtained Ssangyong ’s core technologies through questionable methods and company networks. In early 2009, SAIC withdrew from Ssangyong after reaching its goal. It filed for court receivership, which led to massive layoffs and eventually violent strikes. All of these acute conflicts brought great pain to Korean society.
In this episode of Zooming In, we will take a closer look at how Shanghai Automotive Industry Corporation, China’s top state-owned enterprise, destroyed Ssangyong Motor Company.