Daewoo America responds to story
To the Editor:
Everyone at Daewoo Motor America was disappointed at the inaccuracies in your March 12 article, 'Banks refinance Daewoo America.'
It misrepresented the positive actions approved by the Korean government and financial institutions to confirm their strong confidence in Daewoo Motor America's success and to further encourage its growth in the U.S. market.
The reorganization of Daewoo Motor Korea, the recent labor unrest in Korea, and the possible acquisition by General Motors have been widely publicized.
Having said this, let me clarify your statements concerning Daewoo Motor America.
Banks did not refinance Daewoo Motor America.
The parent company, in cooperation with the Korean government and financial institutions, executed an accounts receivable conversion of about $60 million, resulting in a substantial injection of additional capital into the company.
That debt-to-equity conversion evidences a firm confirmation of strong confidence and continued support by the Korean government and financial institutions in Daewoo Motor America's successful operation and continued growth in the U.S. market.
Furthermore, Daewoo Motor America has been in a satisfactory position of capitalization and now is better prepared than ever to support its sales network of more than 500 dealers.
Since its launch in 1998, Daewoo Motor America has had only one finance company.
It is a world-class, reputable finance company that has provided asset-based financing at a consistently competitive, below-prime-rate basis.
Daewoo Motor America enjoyed an operating profit last year and is on track to enhance its profitability this year, in part by achieving this year's vehicle sales objective by strengthening its dealer network nationwide.
Allegations of payroll difficulties or inability to meet operating obligations to our dealer network are entirely groundless, as they were taken out of context.
In fact, Daewoo Motor America compensated qualifying employees with performance bonus payments during the last two years.
The documented success of Daewoo Motor America continues to be one of the most important elements in the restructuring of Daewoo Motor in Korea.
The inaccuracies in your story undermine the hard work and dedication of our employees and dealers and the solid foundation we have attained in the market.
DONG JIN LEE
President and CEO
Daewoo Motor America Inc.
Has Aztek taken Edsel's place?
To the Editor:
May we now retire the more than 40-year-old term 'Edsel' and replace it with 'Aztek'?
Power executive states his position
To the Editor:
During my participation on a panel discussing the dealer franchise system at the Automotive News World Congress, I commented on several issues, including my support for the dealer franchise system and the need for the system to recognize, embrace and respond appropriately to change.
I understand your space limitations but, unfortunately, by isolating one of my statements on the importance of the franchise system, your Jan. 22 article leaves your readers with the perception that I believe the franchise system will not survive. That is not my position.
In fact, I stated that J.D. Power and Associates' most recent research indicates that dealers have much greater solidarity today than they did the previous year.
I also said the Internet is not going to replace dealers and that dealers will continue to flourish, but possibly in a form more consistent with mass merchandisers.
J.D. Power and Associates
Agoura Hills, Calif.