SEOUL - Daewoo's plans for new models have survived the Korean economic crisis, say senior executives.
Two key projects, the Shiraz large sedan and the Nubira-based small multipurpose vehicle, will both go ahead, as will the company's drivetrain projects.
'The Shiraz will be approved in the next two weeks,' said engineering director Ulrich Bez. 'It will be ready for production by late 2000.'
The Shiraz has been scaled down slightly from the 1997 Geneva show concept. It will be about the same size as the BMW 5 series, according to Daewoo sources.
It will be powered by Daewoo's new inline six-cylinder engine, which is compact enough to be mounted transversely in the car. This engine is part of a family of engines under development at Daewoo's Munich technical center.
The modular engines will range from a 1.0-liter, three-cylinder unit to a 2.5-liter six-cylinder unit. In the middle are a full range of four-cylinder sizes and a 2.0-liter six.
The bigger engines will come first.
'It is important that we introduce these engines in a top-down manner,' said Bez. The smallest engine will replace the current 800cc unit in the new Daewoo Matiz city car.
Daewoo's planned small MPV will be similar to two concept cars that Daewoo has produced in recent years: the 'No. 2' in 1995 and last year's Tacuma.
The MPV will be launched in 1999 and will be built at Daewoo-FSO in Poland as well as in Korea.
Daewoo is still in the process of assimilating the SsangYong vehicle range into its own following last year's takeover.
Bez said the SsangYong name would be dropped 'in the very near future.'
Daewoo recently showed SsangYong's Musso, Korando and Chairman models at a presentation at its Kunsan plant with hastily applied Daewoo logos and grilles.
Bez said the plan was to double SsangYong's production of light commercial and recreational vehicles. The total now is under 100,000 units a year; the goal is nearer 200,000. Sales would be raised by using Daewoo's distribution network.
SsangYong's production operation will remain a stand-alone business unit for the time being. But Daewoo executives are being appointed to the key jobs, with the aim of cutting costs.
Bez said the SsangYong range fits well with that of Daewoo.
'I like the styling of the Korando in particular, though the Musso is rather conservative,' he said. 'And I would prefer to rename the Chairman, possibly to Arcadia.'
Arcadia was the name given to Honda Legends that Daewoo assembled under license for several years.
Bez is involved in negotiations with Daimler-Benz over Daewoo's plans for SsangYong vehicles. There are two big issues:
All SsangYong cars use Daimler engines, and the Chairman luxury sedan is based on the old E-class platform. As a result, SsangYong has been paying royalties to Daimler-Benz on every car. Daewoo wants to avoid paying royalties.
SsangYong cars cannot be sold in markets where they would be in direct competition with Mercedes-Benz. For example, SsangYong's Istana light commercial vehicle cannot be exported to Europe, because it is basically a Mercedes MB1000.
The Chairman is also excluded from developed markets because it could cut into sales of Mercedes' luxury sedans.
Bez said he is not sure whether Daewoo is ready to sell such a luxury car in western Europe, but he believes it could compete with Zil and Volga limousines in central and Eastern Europe.
Mercedes still has a 3 percent stake in SsangYong Motor following Daewoo's purchase of 52 percent of the company.
Daewoo Chairman Kim Woo-choong believes the shareholding issue will be settled amicably. 'On the whole,' he said, 'there is no lack of consensus, though there are still some areas of dispute.'