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GM Korea’s March domestic sales slump 58 percent as restructuring weighs

SEOUL (Reuters) – General Motors’ (GM) South Korean unit said on Monday its domestic sales for March more than halved from a year earlier, deepening a slide in the aftermath of the U.S. automaker’s planned restructuring of operations in the country.

Vehicles are assembled at an assembly line of GM Korea’s Bupyeong plant in Incheon, South Korea March 29, 2018. REUTERS/Kim Hong-Ji

GM had said in February it will shut down one factory and decide on the fate of its three remaining plants in South Korea amid mounting losses there.

While the automaker’s presence in the South Korean market is small with most cars made there destined for export, the continuing tumble in sales highlights reluctance among prospective customers to own GM vehicles, given the uncertainty about its operations.

A GM executive said last week that its South Korean operations would file for bankruptcy if its union did not agree to cut labor costs by April 20, heaping pressure on workers and the South Korean government to swiftly agree a rescue plan.

The logo of GM Korea is seen at its Bupyeong plant in Incheon, South Korea March 29, 2018. REUTERS/Kim Hong-Ji

GM Korea posted a 58 percent drop in its local sales for March to 6,272 units versus a year ago, the company said in a statement.

The car maker recorded total sales of 41,260 vehicles in March, including exports, compared to 50,850 a year earlier. Its domestic sales had plummeted by 48 percent for February, year-on-year.

GM Korea’s exports have been hit in recent years after the U.S. automaker pulled its Chevy brand from Europe, a major market for the Korean firm.

South Korea has said it started due-diligence on GM Korea’s finances to decide whether to provide public support for the troubled firm.

Reporting by Haejin Choi; Editing by Hyunjoo Jin and Muralikumar Anantharaman

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