20721
South Korean church to end car venture with North
Posted on 27 Nov 2012859 Views Comments
Sun Myung Moon, the founder of the Unification Church and a sprawling business empire, died in September aged 92. He was born in what is now North Korea
One of the more bizarre joint ventures in car-making is set to come to an end following the death of the head of South Korea's Unification Church which it is to give its stake in the Pyeonghwa Motors operation to North Korea.
Pyeonghwa, which produces models based on ageing Fiat SpA designs as well as those of Brilliance China Automotive Holdings, is the sole carmaker in isolated North Korea, although few of its impoverished citizens are able to afford its products.
"Pyeonghwa Motors' South Korean side is planning to pull out from the joint automaker and donate its 70 percent stake to the North," said a source familiar with the transaction, who declined to be identified due to the sensitivity of the issue.
Spokesmen for the church were not immediately available for comment. Sun Myung Moon, the founder of the Unification Church and a sprawling business empire, died in September aged 92. He was born in what is now North Korea.
The church's joint venture with North Korea, set up in 2002, was one of the few to survive a freeze in relations between the North and South following the shooting of a South Korean tourist in 2008 by North Korean troops.
"The Unification Church's Moon made a will to give back the auto business with the North before he passed away. It is not because its business wasn't doing well," said the source.
Pyeonghwa produces about 2,000 vehicles a year, according to the source, in a country where most independent estimates say that gross domestic product per capita is less than $2,000.
Other estimates put Pyeonghwa's output at 1,000 cars a year or less. While many North Koreans can only dream of owning a car, it appears that the country's top leadership prefers something a little more upmarket.
When leader Kim Jong-il died in December last year, he took his final journey atop an aged Lincoln Continental, which was accompanied by a fleet of black Mercedes sedans.
Pyeonghwa is based in the North Korean city of Nampho and the company says on its website (www.pyeonghwamotors.com/eng/) that its 10.76 million square foot factory has the capacity to produce 10,000 vehicles a year.
It listed sales as 1,873 vehicles in 2011. North Korea has vowed to become a "strong and prosperous nation" by 2012, although initial expectations that its youthful new leader Kim Jong-un would open the country for more business appear to have been dashed.
Investors from China, the North main diplomatic and economic backer, have complained that they have been shaken down while doing business there.
(Writing by David Chance; Editing by Robert Birsel)
Do you like this story?
- Previous Story
- Next Story
Readers' opinions ( 0 )
Post a Comment
Post a CommentSsangYong Rexton W : First Drive
by Vikram Gour Photography : Kunal Khadse
Mahindra is set to compete in the entry level...
SsangYong Rexton W : Special Coverage
by Team ZigWheels Photography : Kunal Khadse
The Rexton W that has now been launched pan India...
SsangYong Rexton : Exclusive Photo Feature!
by Adil Jal Darukhanawala Photography : Kunal Khadse
We take a closer look at the third generation of...
The Ferrari Way : Special Coverage
Ferrari has been voted as the most powerful brand in the world according to Brand Finance and the...
Chevrolet Enjoy : Special Coverage
Designed to take on everything from the Maruti Suzuki Ertiga to the Toyota Innova the Enjoy is...
