Scania Korea recently announced it will suspend its $20 million investment in South Korea.
Scania Korea, which is a subsidiary of Swedish truckmaker Scania, previously announced its plans to complete the Dongtan maintenance plant, in Seoul, by May 2014. The company said that it will put the investment on hold, citing a request by VW, its largest shareholder, to improve profitability in South Korea.
The company said it still plans to break ground on the plant sometime between 2015 and 2016, but first t will have to consult with its major shareholders and reach profits at its other maintenance centers in South Korea.
On another matter, Scania truckmaker managed to avoid the usual seasonal slowdown in the European market in the third quarter as fleet operators increased new vehicle purchases. Fleet operators hurried to purchase new vehicles during the third quarter before the enforcement of the new emission standards which will make vehicles more expensive starting with January 1st.
“We have seen some softening during the summer, but one should put that in the perspective of the order backlog, the lack of visibility and the extreme demand that we have had,” Chief Executive Martin Lundstedt said during a presentation at Scania’s headquarters south of Stockholm.