#overseas

An interview with Forbes the boss of the Korean Development Bank, which GM-Daewoo still owes several billion dollars, reveals that GM’s South Korean unit had a debt-to-equity ratio of 912 percent as recently as last June. GM “rescued” its crucial small-car development center by buying up all $413m of GM-Daewoo’s recent share offering, keeping the the KDB from imposing its will on the automaker. That was enough to keep the wolf from Daewoo’s door in the short term, but if Daewoo is ever going to develop a new generation of GM small cars and global products, it will have to address its $2b KDB debt and raise additional funds. For now though, GM-Daewoo is just hoping to keep a little momentum going.

Yesterday Daimler announced that McLaren would be buying out Daimler’s interest in their joint venture Formula 1 team. Many, including board member Erich Klemm, thought this made all kinds of sense. “In the (car) factories, every cent is being turned over three times. The employees are feeling the financial crisis with shorter working hours and loss of income,” he continued. “In these economically difficult times, the company should invest in better marketing of its real cars.” My, what a novel idea!