Daewoo Motor company will resume making cars next week after subcontractors decided to restart parts supplies after a five-day boycott of the troubled carmaker.
Daewoo Motor's three plants have been idle since its subcontractors halted parts deliveries.
It's in protest at the company's delays in paying 1.5tn won (£0.8bn) in overdue bills.
During a meeting, parts suppliers decided to end their boycott , said Lee Sang-ki, an official at the association of 275 parts suppliers for Daewoo Motor.
The decision came after Daewoo's main creditor, Korea Development Bank, promised to give 122.3bn won (£66mn) in loans for subcontractors in serious financial strains caused by Daewoo Motor's collapse last year, officials said.
Daewoo's latest trouble has clouded the prospect of a takeover deal with General Motors Corp of the United States.
After months of talks, GM signed a non-binding preliminary agreement in September to acquire control of Daewoo. The auto giant had said it planned to sign a binding agreement before year's end after a final due diligence. But unconfirmed local news reports said the negotiations were unlikely to be wrapped up by year's end.
Daewoo Motor, a flagship of the giant Daewoo group which collapsed in the aftermath of the 1997-1998 Asian financial crisis, went bankrupt in November last year and has since been under court receivership. Its total debt is estimated at over $ 17bn.