Korean Turnaround Tales

There isn't much good news from General Motors these days. Its once dominant U.S. market share is slipping. Steel and labor costs are mounting. Profits are evaporating. But there's an unexpected bright spot in Asia: GM's South Korean unit, GM Daewoo Auto & Technology. In 2002, GM and its partners acquired the choicest assets of bankrupt Daewoo Motor for $440 million—and it looked like they overpaid. Daewoo's market share in Korea was shrinking and its factories were running at half their capacity. Union members tried to thwart the deal by rioting around the main factory near the port city of Inchon....

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