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GM’s Korean Unit Has ‘Very Profitable’ 2010 After Two Losses

December 16, 2010
2 min to read



General Motors Co.’s South Korean unit will post its first annual profit since 2007 helped by surging exports to Eastern Europe and other emerging markets, reported Bloomberg.


“GM Daewoo had a very profitable year,” Mike Arcamone, chief executive officer of GM Daewoo Auto & Technology Co., told reporters at the company year-end party in Seoul late yesterday, without elaboration.


The automaker will likely boost vehicle shipments, including unassembled cars, 17 percent this year to more than 1.8 million, Arcamone said, helped by demand for Chevrolet Cruze compacts, Spark minicars and Alpheon sedans. The Incheon, South Korea-based unit made losses in 2008 and 2009 because of wrong- way bets on currency hedging and slower sales amid the global recession.


GM Daewoo plans to roll out seven new models by the end of next year and to start selling Chevrolet cars in South Korea in 2011, Arcamone said. The CEO, appointed a year ago to turn around the money-losing unit, has set a goal of increasing its market share in South Korea to more than 10 percent this year.


Excluding exports of unassembled vehicles, GM Daewoo expects to sell more than 750,000 vehicles this year, Arcamone said. The automaker sold 680,305 vehicles in the first 11 months, 33 percent more than a year earlier, according to a statement.


GM owns a 70 percent stake in the South Korean unit, while Suzuki Motor Corp.holds 6.8 percent and SAIC Motor Corp., GM’s China partner, has 6 percent. Korea Development Bank, GM Daewoo’s main creditor, owns the remaining 17 percent.


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