Ssangyong Motor suffered estimated direct and indirect losses of W600 billion from a strike that has lasted for 61 days, even as a court must decide whether the ailing SUV maker is worth saving from bankruptcy (US$1=W1,249).
There have also been casualties. About 110 people have sustained injuries in clashes between striking workers and police, and between unionized workers and non-union employees, four of whom were seriously injured and taken to hospital.
There has also been damage to the brand name, and if such intangible losses are calculated, the losses could amount to more than W1 trillion, according to experts.
They estimate that Ssangyong suffered a loss of W245.6 billion due to disrupted production caused by the strike, based on the average per-car production cost of W21.31 million multiplied by 11,520 cars that have not been produced since the strike began. The sales network has also collapsed, with the number of its dealerships dropping from 210 to 140 and that of salespeople from 2,500 to 1,500.
Before the strike, the court estimated that Ssangyong's survival value was W389 billion more than its liquidation value. But since the strike started, the loss amount has already exceeded W240 billion, making it seem likely that liquidation will soon be the more economical option.
The automaker's subcontractors are suffering combined losses of W200 billion from lost sales during the strike, said Choi Byung-hoon, the secretary general of the Ssangyong Motor Subcontractors Association.
The city of Pyeongtaek estimated the city's economic loss at W14 billion as a result of reduced consumption by about 40,000 people, or 10 percent of the population -- 4,500 Ssangyong staff, 5,500 employees of the automaker's subcontractors, and their families.
Ssangyong staff also lost out. Some 1,670 who applied for early retirement failed to receive a total of W130 billion including bonuses and severance pay.
Striking workers themselves also lost money. Some 450 of them stood to receive bonuses of W11.2 billion, an average of W25 million per worker, if they applied for an early retirement package. Some 320 of them, who were entitled to other positions such as sales posts, have also lost out on monthly pay which they could have earned if they had kept working.
Choi Jae-hwang, a director at the Korea Employers Federation, said the intangible loss is larger than the tangible loss. "Looking at the violent struggle by the unionized workers, more and more overseas investors will make a low estimate of the value of Korean enterprises,” he said.
The cost of police resource is also enormous. A total of 53,000 police officers had been mobilized until Tuesday to deal with the Ssangyong incident, the National Police Agency said.
