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GM suspends $445-million Thai diesel project-paper

Published 11/29/2008, 02:39 AM
Updated 11/29/2008, 02:42 AM
TM
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BANGKOK, Nov 29 (Reuters) - Troubled carmaker General Motors Corp has suspended construction of its $445-million diesel-engine facility in Thailand due to the global financial crisis, the Nation newspaper reported on Saturday.

Work on the site in Rayong, 150 kms (90 miles) southeast of Bangkok, was put on hold for one year, said Steve Carlisle, president of General Motors in Southeast Asia.

"The availability of cash is one of the problems for GM globally, and this is one of the reasons we have put on hold work at the site. Hopefully we will restart work within one year," Carlisle was quoted as saying.

A GM spokesman was not immediately available for comment.

The facility would produce engines for Chevrolet models for sale in Thailand and other markets, part of GM's strategy to offset falling U.S. auto sales, the newspaper said.

Earlier this month, GM said it would shut its Rayong plant for two months from mid-December due to falling demand caused by the global economic slowdown.

Toyota Motor Corp <7203.T> said it also planned production cuts in Thailand while Japanese camera maker Nikon <7731.T> recently cut 1,500 staff at its Thai plants, following other international companies seeking to stave off the impact of deepening economic gloom. ($1=35.45 Baht) (Reporting by Orathai Sriring; Editing by Darren Schuettler)

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