Daewoo Motor May Suspend Operations Friday On Parts Supply Stop Thursday

Monday August 26

SEOUL -Dow Jones reported that Daewoo Motor Co. is likely to suspend operations from Friday at three plants after its suppliers said they will halt providing car parts to the South Korean carmaker indefinitely starting Thursday to protest a delay in making payments.

Daewoo Motor will have to shut down the operations at all three of its plants in South Korea about a day after the supply halt, said Daewoo Motor spokesman Kim Sang-won Monday.

All 191 of the company's "first-tier suppliers" will cease supplying parts until Daewoo Motor promises to pay the overdue payments, said Um Ki-Hwa, head of the Daewoo Motor supplier association.

Daewoo Motor, which has failed to pay its commercial bills since mid-June, currently owes a total of 80 billion won ($1=KRW1205.3) to KRW90 billion to the 191 suppliers, Um said