General Motors’ South Korean unit plans to slash 5,000 jobs, or about 30 per cent of its workforce, but keep production steady if Seoul agrees to its $2.8 billion proposal for the loss-making operation, according to a document seen by Reuters.

The US automaker announced last month that it would shut down a factory in Gunsan, southwest of Seoul, and that it was mulling the fate of its three other plants in South Korea.

The Detroit automaker, which owns 77 per cent of GM Korea, is negotiating with the South Korean government over the restructuring proposal, as state-run Korea Development Bank (KDB) owns a 17 per cent stake. GM’s main Chinese partner, SAIC Motor Corp. Ltd, controls the remaining six per cent. In the plan it submitted GM Korea proposed cutting the number of employees to 11,000 from about 16,000.

Because only 2,000 people work at the Gunsan facility, it appears the other factories will also be affected.

GM’s proposal may put the Seoul government in a bind, as President Moon Jae-in seeks to save thousands of jobs but could face a public backlash if he uses taxpayer money as a lifeline for GM.

The document also showed GM plans to over 10 years create 1,100 new jobs, plus build two new sports utility vehicle (SUV) models and a compact car engine in South Korea.

The government has said it would decide on whether to provide support after conducting due diligence on what it has called GM’s “opaque” management of its operations in the country.

GM Korea declined to comment on details of the proposal.