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Korea Herald
28-05-2025
- Automotive
- Korea Herald
GM Korea to sell non-core assets, service centers amid sluggish sales
GM Korea, the South Korean unit of General Motors, said Wednesday it will dispose of non-core assets and directly managed service centers as part of its efforts to sustain operations amid weak demand for its vehicles. In response to a rapidly evolving industry landscape and global business challenges, the company said in a press release that it will begin consultations with relevant stakeholders to secure financial sustainability in the Korean market. GM Korea plans to gradually sell all nine of its directly operated after-sales service (AS) centers. However, all employees at these centers will be reassigned to other divisions within the company, it said. "Unlocking value from surplus assets and eliminating loss-making service operations are critical to supporting ongoing sustainability," Hector Villarreal, president and managing director of GM Korea, said. The company also plans to sell idle properties and facilities within its main Bupyeong plant, located just west of Seoul. It emphasized that the planned asset sales will not affect production at the facility. "Our current vehicle programs still have many years to run, and these actions are important to ensuring GM Korea is running as efficiently as possible," he said. Despite the planned sale of the directly managed service centers, GM vehicle owners will continue to receive after-sales services through the company's 386 contracted AS centers nationwide, the company said. The move comes amid growing concerns over a potential withdrawal by GM from the South Korean market, driven by shifting US tariff policies. However, the company dismissed the possibility of such a move. "These actions are aimed at ensuring our business operates as efficiently as possible and remains an attractive destination for investment," a company official said. Speculation over GM's possible exit from South Korea has mounted following the imposition of a 25 percent tariff on imported vehicles by the United States since April, compounded by the automaker's lack of new models and sluggish sales. Detroit-based GM currently operates two plants in South Korea: one in Bupyeong and another in Changwon, 296 kilometers southeast of Seoul. The Bupyeong plant manufactures the Trailblazer sport utility vehicle (SUV), while the Changwon factory produces the Trax Crossover for both domestic sale and export. In the January–April period, GM Korea's total vehicle sales declined 9.1 percent to 154,161 units, down from 169,638 a year earlier. About 85 percent of its vehicles are shipped to the US. (Yonhap)
Korea Herald
16-05-2025
- Automotive
- Korea Herald
GM Korea CEO visits Changwon plant amid US tariff-related exit concerns
The chief executive officer of GM Korea Co., the South Korean unit of General Motors Co., has visited the automaker's Changwon plant to encourage employees amid growing concerns over a potential withdrawal driven by shifting US tariff policies, the company said Friday. GM Korea CEO Hector Villarreal visited the plant, located 298 kilometers southeast of Seoul, on Thursday to meet with employees and reinforce on-site management, the company said in a press release. Speculations over GM's possible exit from South Korea have been mounting following the imposition of a 25 percent tariff on imported vehicles in the United States since April, along with the automaker's lack of new models and sluggish sales. GM Korea ships about 85 percent of its exports to America. The Detroit-based automaker operates two plants in South Korea: one in Bupyeong, just west of Seoul, and another in Changwon. The Bupyeong plant produces the Trailblazer sport utility vehicle, while the Changwon factory manufactures the Trax Crossover for both domestic sales and exports. In the January–April period, GM Korea's sales fell 9.1 percent to 154,161 vehicles, down from 169,638 units a year earlier. (Yonhap)
Korea Herald
02-05-2025
- Automotive
- Korea Herald
GM Korea's April sales fall 6.3% on weaker demand
GM Korea Co., the South Korean unit of General Motors Co., said Friday its sales fell 6.3 percent in April from a year earlier on lower demand for its models. The company sold 41,644 vehicles last month, down from 44,426 units in the same period last year, the company said in a press release. Domestic sales plunged 42 percent on-year to 1,326 units last month from 2,297, while exports declined 4.3 percent to 40,318 from 42,129. From January to April, total sales dropped 9.1 percent to 154,161 units from 169,638 a year earlier. Domestic sales tumbled 41 percent to 5,434 units from 9,216, while exports were down 7.3 percent to 148,727 from 160,422. As part of a two-track strategy, GM Korea sells both domestically assembled and imported vehicles in South Korea, Asia's fourth-largest economy. Its current lineup is composed of two locally assembled models -- the Trailblazer SUV and the Trax Crossover -- and two imported models -- the Colorado pickup and the GMC Sierra Denali pickup. (Yonhap)
Korea Herald
02-04-2025
- Automotive
- Korea Herald
GM Korea CEO dismisses exit rumors amid looming US tariffs
Over 85% of Korean production ships to US, putting cost competitiveness at risk GM Korea CEO Hector Villarreal has dismissed concerns over the company's potential withdrawal from South Korea, just three days before US President Donald Trump's 25 percent automotive tariffs on imported vehicles and parts are set to take effect. According to GM Korea on Wednesday, Villarreal held a 20-minute online meeting with office staff on Monday — his first public remarks addressing speculation about the company's possible exit from the Korean market. 'The company plans to continue its business without any changes,' Villarreal said, emphasizing that operations at its Bupyeong (Incheon) and Changwon (South Gyeongsang Province) plants remain stable despite the looming tariffs. He also assured employees that any changes to production plans would be communicated promptly, adding that GM Korea is 'continuously preparing various scenarios' to address the evolving tariff situation. Villarreal also highlighted the importance of regulatory compliance and reducing unnecessary costs. His comments come amid growing uncertainty over GM Korea's future, as the US automaker faces steep import tariffs that could significantly disrupt its core export business. GM Korea shipped approximately 419,000 units to the US last year — 84.8 percent of its total production — far surpassing the export ratios of Hyundai Motor and Kia, which stood at 46.6 percent. The Korean unit currently produces compact SUVs, including the Trailblazer, at the Bupyeong plant and the Trax Crossover at the Changwon plant. It has long leveraged Korea's efficient supply chain, a legacy from its origins as part of Daewoo Group. GM acquired Daewoo's passenger car division, R&D assets and facilities in 2002, operating as GM Daewoo until a 2011 rebranding to GM Korea. However, the new tariffs are expected to challenge the company's cost-effective export strategy, potentially slashing its price competitiveness in the US market. Industry analysts warn that GM's headquarters in the US may re-evaluate the viability of its Korean unit, possibly considering a gradual phase-out of local production or even a full withdrawal from the country. GM Korea previously closed its Gunsan plant in 2018 after its operation rate fell to around 20 percent due to a prolonged domestic sales slump. At the time, the Korea Development Bank injected 810 billion won ($552.6 million) on the condition that GM would maintain its Korean operations for at least 10 years. Despite a low market share in Korea's domestic auto market, GM Korea has served as a key export hub to the US — a position now under threat. 'When the automaker shut down its Gunsan facility, thousands lost their jobs, including around 1,800 direct employees and even more from partner companies,' said Lee Kang-koo, head of the Jeonbuk Institute of Automotive Convergence Technology. 'If GM decides to shut down its remaining plants, the repercussions on the local economy would be severe.' Lee added that while Hyundai and Kia are expanding their North American production capacity with over 100 Korean partner companies, GM may instead focus on ramping up its US-based operations through existing partnerships. GM Korea currently employs more than 11,100 executives and staff, and over the past 21 years, it has produced around 26.5 million fully and partially assembled vehicles.
