Tesla supplier agrees to buy GM's S.Korean plant for EV manufacturing (updated)

MS AUTOTECH

29/03/2019 02:46

* Tesla supplier to buy shuttered plant for $100 mln
    * Plans EV contract manufacturing from 2021
    * The firm is in talks with a potential global
customer-source

 (Adds GM announcement, comments)
    SEOUL, March 29 (Reuters) - A South Korean supplier of Tesla
Inc  TSLA.O  said on Friday it had agreed to buy a shuttered
auto factory from General Motors'  GM.N  local unit to start
contract manufacturing of electric vehicles. 
    The deal comes after GM closed one of its four South Korean
plants in late May and let go thousands of workers, as part of a
global restructuring drive which culminated in a major financial
support package from the South Korean government.  urn:newsml:reuters.com:*:nL2N1Q302X
    GM did not disclose the sales price of the Gunsan factory,
but auto parts maker Myongshin said it would buy the land and
buildings of the GM facility for 113 billion won ($99.5
million)on June 28.
    Myongshin, also a Hyundai Motor  005380.KS  supplier, is
part of a consortium which would initially spend a total of 200
billion won on the factory to produce 50,000 EVs starting 2021
and 150,000 EVs in 2025, according to a statement by a
provincial government.
    "We aim to close this deal as soon as possible to ensure
that there will be ongoing economic activity," GM Korea said in
a statement.  
    The consortium was in talks with an unidentified global
automaker to manufacture electric vehicles at the facility, a
source with direct knowledge of the matter earlier told Reuters,
adding that it was not Tesla.
    The plant could take advantage of South Korea’s free trade
deal with the United States and Europe, as well as the country's
electric car supply chain, he said.       
    The electric car factory would create 900 jobs and another
2,000 at suppliers and other firms, the North Jeolla Province
government said. 
    GM's loss-making South Korean operation used to be a key
manufacturing base for the company in Asia but it has been hit
hard by the U.S. automaker's exit from Europe, a major export
market. GM executives have also complained about labor costs and
disputes.
($1 = 1,135.9800 won)

 (Reporting by Hyunjoo Jin; Editing by Stephen Coates)
 ((hyunjoo.jin@thomsonreuters.com; 82-2-3704-5685; Reuters
Messaging: hyunjoo.jin.thomsonreuters.com@reuters.net))