SOUTH Korea's government said it will let Ssangyong Motor Co's parent SAIC Motor Corp and main creditor Korea Development Bank to decide whether to provide the auto maker with the financial aid it needs to survive.

SAIC, China's biggest auto maker, didn't ask the South Korean government for direct help with its unit, Lee Dong Geun, deputy minister of knowledge economy, told reporters yesterday, after government officials met an SAIC executive.

Ssangyong's sales plunged 27 percent in the first 11 months as customers shunned its sport-utility vehicles in favor of smaller cars, Bloomberg News said. The Korean car industry asked for government aid, including tax cuts on fuel, capital for car loans and lending to manufacturers, Korean auto makers said late last month.

'Ssangyong is actively seeking support from the Korean government and banks while talking to the union to lower labor costs to overcome the difficulties in their operation brought by the global financial crisis,' Zhu Xiangjun, a spokeswoman for SAIC Motor, said without elaborating.

The Chinese auto maker is due to give Ssangyong 120 billion won (US$93 million) in technology transfer fees and the Korean car maker has unused credit lines worth up to 200 billion won from Chinese banks, according to a Yonhap report yesterday. SAIC owns 51 percent of Ssangyong Motor.

The auto maker posted a loss of 98.1 billion won in the January-September period, against a profit of 16.7 billion won in the same period a year earlier. Output will be suspended until Wednesday at all plants, the firm said earlier this month.