"We recognize the contribution and support of our employees, the wider Gunsan and Jeonbuk communities and government leaders, particularly through the most recent hard period", said Kaher Kazem, president and CEO of GM Korea.
Given Barra's bold moves to streamline GM operations globally, including selling Opel in 2017 and withdrawing from the Russian market, it initially looked as though the company was preparing to call it a day in Korea.
"Time is short and everyone must move with urgency", GM President Dan Ammann told Reuters.
GM Korea operates two more auto plants in Korea, in Bupyeong west of Seoul and Changwon in South Gyeongsang Province, and employs 14,200 workers, swelling to 300,000 if subcontractors are included. Cumulative losses over the last four years stand at W3 trillion (US$1=W1,086).
Besides truncating a large portion of the factory space, GM is also taking charge of $850 million, which also includes $475 million of non-cash asset impairments and up to $375 million of primarily employee-related cash expenses. It has shut down its manufacturing operations in Australia, abandoned its retail network in India, walked out of the Russian and South African markets, and sold off its European Opel/Vauxhall subsidiary to France's PSA.
GM says the plant will close by May 2018, but is working with "key stakeholders" - including the labor union and the South Korean government - to develop a plan to turn the South Korean business around.
The Korean government, meanwhile, expressed deep regret over GM's "unilateral" decision, but said will have Korea Development Bank to work with GM to study the situation at the business. Most of the financial writedowns would be recorded by the end of the second quarter.
The firm's key officials state that the shutdown of the unit is a part of its business restructuring plan in Asia.
"The Gunsan area will take a significant blow but considering GM's management problems which lack transparency, the government has no duty to help the company", Kim Pilsu, a Professor of Daelim University College said. However, the rise in the labor costs, low demand for sedans, and high investments across automobile sector in China have hindered GM's growth prospects in the country, apparently.
According to data from the Korea Automobile Manufacturers Association (KAICA), the number of cars sold in South Korea past year was estimated at around 1.56 million units, down 2.5 percent from 2016.
The plant is located in Gunsan, 270 kilometers south of Seoul, which employs some 2,000 workers. GM Korea sold 132,377 vehicles in its home market past year while exporting roughly 390,000 vehicles to 120 global markets, according to Automotive News.
GM isn't ready to give up on Korea, however. GM owns 77 percent of the operations while GM's main Chinese partner, SAIC Motor Corp., controls 6 percent.