General Motors snubs Craiova-based Daewoo plant

General Motors made a decision: they are not buying the Daewoo plant in Craiova. Although previous information had pointed to negotiations between the shareholders of the Craiova-based plant and GM DAT (GM Daewoo Auto & Technology), the company established by General Motors and the Daewoo lenders, talks failed to materialise into something benefiting Daewoo Craiova. At least this is the situation for the near future.

“There are no such plans for the moment (buying the Craiova company, i.e.). However, I do not know where we will stand in 3-4 years,” said Nick Reilly, GM DAT CEO.

According to Reilly, there are two possibilities for the Daewoo plants that were not included in General Motors’ plans, when Daewoo transferred part of its assets to its lenders and the American giant.

“We may decide to buy some of these plants and then, those that we will purchase will be working not only for the local market, but will export to the entire area, as well,” Reilly said.

The second possibility is far bleaker for the plants in Romania, Poland and Ukraine, as it brings the end of CKD (completely knocked down) collections, especially since General Motors owns a plant in Poland, where it can make GM DAT automobiles.

“When our company was established (October 2002, i.e.), we agreed to supply CKD collections to these plants for another three years. We will probably cease our collaboration with several plants, but I believe we will also prolong it with some of these companies. It remains to be seen how things will evolve by that time,” Reilly said, adding that the Uzbekistan factory was the top performer among the companies where Daewoo Motor was still a shareholder.

In fact, in some of these countries, GM DAT has started selling its own cars under different brands. “We have started selling our automobiles under the Chevrolet brand in Eastern Europe. The first country in the area was Romania, with Bulgaria, Turkey, Ukraine and Poland to follow,” said Hardy Spranger, in charge of GM DAT European operations.

According to Spranger, this is not a temporary operation. “This was a strategic move and such a decision cannot be temporary,” Spranger added.

GM DAT is also distributing the Nubira model in Romania, where the Craiova-based plant had already been selling the Daewoo Nubira car.

“The old Daewoo and the new cars made by GM DAT were bound to compete against each other on markets where a producer such as the plant in Craiova was already operating. In fact, we are competing against imported brands, not the automobiles made locally,” Spranger commented.

The GM DAT official says the company will not bring the Matiz model to Romania, as those buying such a model care only about the price. ionut.bonoiu@zf.ro