SEOUL, Sept. 29 (Korea Bizwire) — SsangYong Motor Co., a South Korean SUV-focused carmaker, said Thursday it will export about 170,000 vehicles to a Saudi Arabian company by 2030 in the form of semi knockdown (KD) units.
In January, SsangYong Motor signed the KD supply deal with Saudi National Automobiles Manufacturing Co. (SNAM) for seven years from 2023.
Under the deal, SsangYong will initially provide KD units to SNAM’s plant for the parts to be assembled into SsangYong’s three models — the new Rexton Sport, new Rexton Sports Khan and all-new Rexton SUVs, SsangYong said in a statement.
SNAM plans to begin the production of the SsangYong models from 2023 and aims to produce up to 30,000 units a year based on the plant’s expansion, it said.
SsangYong plans to ship KD units that will be assembled at the Saudi plant into 90,000 units of the new Rexton Sport and new Rexton Sports Khan SUVs and 79,000 units of the new Rexton SUVs in the seven years.
SNAM will build Saudi Arabia’s first car manufacturing plant to assemble the SsangYong models under an original equipment manufacturer agreement with the carmaker, SsangYong said.
But in the long term, SNAM aims to consider producing its own vehicles for exports in the Middle East.
For the whole of 2021, SsangYong’s net losses narrowed to 292.9 billion won (US$244 million) in 2021 from 504.34 billion won a year earlier on companywide drastic cost-cutting efforts.
Its vehicle sales fell 22 percent to 84,106 units last year from 107,324 a year ago amid the COVID-19 pandemic and a chip shortage.
From January to August, however, its sales jumped 23 percent to 68,926 autos from 55,904 units a year earlier.
SsangYong’s lineup consists of the Tivoli, Korando, Rexton, Rexton Sports and Torres SUVs.
SsangYong has been under court receivership since April 15, 2021, as its Indian parent firm Mahindra & Mahindra Ltd. failed to attract an investor amid the COVID-19 pandemic and its worsening financial status.
In June, the Seoul Bankruptcy Court picked a local consortium led by chemical-to-steel firm KG Group as the final bidder to acquire SsangYong.
Last month, the court approved SsangYong’s rehabilitation plan, paving the way for it to get its business back on track.
SsangYong expects it will be able to graduate from the court-led debt rescheduling program within this year if all the planned debt payments are completed as scheduled.