Smallest automaker matches its big ambitions

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Smallest automaker matches its big ambitions

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Ssangyong Motor shows off the manufacturing process of its popular Tivoli SUV model at its plant in Pyeongtaek, Gyeonggi, on April 20. [SSANGYONG MOTOR]

PYEONGTAEK, Gyeonggi - Hopes are high at the manufacturing plant of the nation’s smallest automaker, Ssangyong Motor, that its newly-released small SUV, the Tivoli, will continue to be a big hit.

When the Korea JoongAng Daily visited the plant on April 20, a placard promoting “Journey to success with Tivoli” hung on the wall of a facility where car bodies stood in line waiting to go through about 100 processes before being ready for the market. Given precisely 189.5 seconds and 6.5 meters (21 feet) of space to complete each process, mechanical arms and staff worked in rapid, tight synchronization to pump out new cars.

At the company’s main production line, which produces the automaker’s key models - the Tivoli, Tivoli Air and Korando C - 19 cars are produced per hour, which adds up to 367 cars each day. Last year, 87,979 cars were produced solely on this line.

To keep the lines flowing, workers put in an extra three hours of overtime after dinner until 9 p.m., except for Wednesdays, which is set as a family day, voluntarily. Even on holidays and weekends, workers are kept busy meeting the increasing list of orders.

Regardless of the hours, one worker said, “I’m busy and have less time with my family, but still, this is the happiest time of my 15-year career at this company.” The enjoyment of manufacturing a hot-selling model seems to offset the long hours for most workers.

There was a time when the automaker halted operations at the factory due to lack of demand. According to employees, their work often finished before 6 p.m., and sometimes, the workday was often filled with seminars or training sessions since there were not enough orders.

The slump peaked in 2009, when the company applied for legal management by the government mainly due to financial troubles and laid off 2,614 workers in the process.

However, hope has sprouted with the release of the Tivoli last January, a stylish small-size SUV with a competitive price, which successfully entered the fierce domestic SUV market with 63,693 units sold last year. The success of its follow-up longer-body model, the Tivoli Air, has further boosted sales of the Ssangyong brand.

The strong flagship model played a critical role in turning company profits to a surplus of 21.8 billion won ($19.1 million) in the last quarter of 2015. It was a record surplus after seven quarters of losses for the company.

The gradual stabilization of the company’s financial balance sheet has brought about changes in the working environment as well. For existing workers, increased orders and extra hours of work have earned them about twice the pay they used to receive in 2014.

“To be frank, I earned about 20 million won more last year compared to 2014,” said Kim Sung-jin, an executive technician at the company. “My wife is happy about it, and my kids also recognize my work.”

For those who left the company during its difficult times, 40 jobs were made available, with 16 of them being filled by the children of workers who had been fired.

“It is a bit late, but we are happy to see them coming back to work, and we hope we can sell more cars to bring everyone [all the fired workers] back in the end,” said Shim Jong-bo, executive technician for production line No. 1.

The company and its labor union agreed last year to rehire, in stages, about 1,600 workers that had been laid off. The timing of their return will depend on the future performance of the company.

The plant is currently operating at about 60 percent of full capacity, but the company aims to increase the rate to 100 percent within three to four years by introducing at least one new model every year.

Follow-up models for the Rexton W and Korando Sports are due to be released over the next two years.

According to the company’s performance results for the first quarter of this year, released last Thursday, the automaker posted 813.2 billion won in revenue with 8.1 billion won in profit. It is the automaker’s second consecutive quarter recording a surplus, largely thanks to a 76.6 percent year-on-year sales increase in the Tivoli brand.

The Tivoli Air, which was released in March, is ramping up the automaker’s SUV segment, recording 5,100 sales just one month after its launch.

BY KIM JEE-HEE [kim.jeehee@joongang.co.kr]



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