Ssangyong's plans for restructuring have been cleared by the South Korean courts.
Financial troubles meant Ssangyong, which is part-owned by Chinese car maker SAIC, filed to go into court administration on 9 January this year.
As with US Chapter 11 bankruptcy protection, this process allows the company to restructure and – if the courts approve – return to trading at a later date.
The courts have now decided the manufacturer has a greater value as a going concern than its liquidated value, and ordered Ssangyong to submit its full restructuring plan by mid-September.
Much of this is already in place, including a new model programme and a reduction in the workforce by over a third. Under this plan, the C200 concept car will be launched for sale at the end of this year, reaching the UK by March 2010.
Paul Williams, managing director of Ssangyong distributor Koelliker UK Ltd. said: "This is the news we were hoping for and it means that the company now has the lifeline it needs to implement major changes.