Barry Engle, executive vice president of General Motors (GM) and president of GM International, is back in Seoul for last-minute negotiations after having given the Seoul government to agree to its demands for a bailout program for money-losing GM Korea till the end of this month.

Arriving on Monday, he would be meeting officials of the government, state-run Korea Development Bank, and labor union before making “important decisions on next step” after the Detroit-based automaker earlier this month announced to close down Gunsan, one of the four factories of GM Korea, that has been running at 20 percent of its capacity for the last three years.

Engle overseeing global operations last month had met with presidential aides, government officials, and KDB executives to ask Seoul to provide tax incentives and new equity purchase to recapitalize the debt-heavy automaker. Upon lukewarm response from Seoul, GM last week announced it was shuttering the Gunsan factory of 1,200 workers and indicated it would take further steps with the rest of three factories in Korea if it does not hear “significant progress” from Seoul by the end of February.

GM bought formerly the country’s third largest automaker Daewoo Motor in 2002. KDB retains 17 percent stake. At stake is over 30,000 jobs when including the supply chain. The issue has become trade and political hot potato as the Moon Jae-in administration and the ruling power cannot risk mass-scale job losses with the June local elections coming up. U.S. President Donald Trump publicly called for GM pullout of Korea to create jobs in Detroit as he too faces mid-term election in November.

Seoul maintains it will determine bailout upon closely examining the financial accounts and management conditions of GM Korea, suspecting the GM headquarters of overcharging its Korean unit in parts supplies and loans to worsen its balance sheet.

Another key factor is the notoriously-militant union. GM plans to receive applications for early retirement from workers at Gunsan plant in March and May.

By Lee Seung-hoon and Choi Mira

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]