Members of the Korean Metal Workers' Union's North Jeolla Province chapter rally in front of Hyundai Motor's Jeonju factory on Wednesday afternoon, during a general strike called by the Korean Confederation of Trade Unions in Seoul, chanting demands that Hyundai Motor enter direct negotiations over non-regular workers. [Yonhap]
Members of the Korean Metal Workers' Union's North Jeolla Province chapter rally in front of Hyundai Motor's Jeonju factory on Wednesday afternoon, during a general strike called by the Korean Confederation of Trade Unions in Seoul, chanting demands that Hyundai Motor enter direct negotiations over non-regular workers. [Yonhap]

Hyundai Motor's production lines face a shutdown of up to eight hours a day starting next week, as the company's union escalates its industrial action. After staging two-hour partial strikes per shift this week, the union has voted to walk out for four hours per shift on each of three consecutive days from Monday, raising the prospect of losses reaching as much as 700 billion won ($470 million) when holiday overtime refusals and a parts supplier strike are factored in — marking the second straight year of production disruptions following last year's first strike in seven years.

The Hyundai Motor chapter of the Korean Metal Workers' Union held its third central dispute committee meeting Thursday and resolved to carry out four-hour partial strikes from Monday through Wednesday. In its strike directive, the union said it would "raise pressure on management through the full solidarity of 40,000 members, given that management has made no forward-looking proposals and has not requested a resumption of talks."

The strike hours are double those of this week. The union will have both the day shift and the night shift walk out for four hours each on all three days. The day shift will stop work from 10:50 a.m. to 3:30 p.m., while the night shift will halt from 7:30 p.m. to 12:10 a.m. the following day.

Excluding meal breaks, the effective strike time amounts to four hours per shift, meaning production lines could face up to eight hours of lost operation per day. Permanent day-shift workers will join the walkout from 12:40 p.m. to 4:40 p.m., while general office staff will participate from 1 p.m. to 5 p.m.

The union plans to open the three-day action with a leadership rally at the main building on Monday, followed by a membership briefing on Tuesday and a constituency briefing on Wednesday. The sales, service, Namyang and Mobis committees will adjust their total strike hours to fit their respective circumstances. The union said it would suspend strike activities on any day that main-table negotiations resume.

Day-shift workers leave Hyundai Motor's Ulsan factory through the Myeongchon main gate in Buk-gu, Ulsan, two hours earlier than usual on Monday afternoon, as the union's three-day partial strike gets under way. [Yonhap]
Day-shift workers leave Hyundai Motor's Ulsan factory through the Myeongchon main gate in Buk-gu, Ulsan, two hours earlier than usual on Monday afternoon, as the union's three-day partial strike gets under way. [Yonhap]

Further production losses are also unavoidable this week. The Hyundai Motor union conducted two-hour partial strikes per shift from Monday through Wednesday, with the day and night shifts each stopping work for two hours — amounting to up to four hours of lost line operation per day and a total of 12 hours over the three days. The union has also decided to refuse holiday overtime scheduled for Saturday and Sunday, cutting off an additional avenue for recovering lost output.

The financial damage is expected to be substantial. Last year, the union staged three rounds of partial strikes, resulting in an estimated production shortfall of about 7,000 vehicles and sales losses in the 300 billion won range — equivalent to roughly 16 hours of lost line operation. On a simple proportional basis, the 36 hours of strikes planned for this week and next could alone produce a shortfall of around 15,000 vehicles and sales losses in the 600 billion to 700 billion won range.

The disruption is being compounded by a strike at a parts supplier. Motras, which supplies electronic components and automotive modules, joined the Korean Metal Workers' Union's general strike, causing supply disruptions for certain parts including chassis modules and struts.

The gap between labor and management remains wide. At the 15th round of negotiations, management put forward its third proposal — a base pay increase of 89,000 won, a performance bonus of 350 percent plus 10 million won, and 15 shares of company stock — but the union judged the offer fell short of members' expectations. The union is demanding a base pay increase of 149,600 won, a performance bonus equivalent to 30 percent of last year's net profit, an 800 percent increase in bonuses, an extension of the retirement age, and the reinstatement of dismissed workers.

Management maintains it has already put its best offer on the table. Hyundai Motor chief executive Choi Young-il said in an earlier statement that it was "regrettable" that the union was striking over issues such as the reinstatement of dismissed workers and a retirement age extension, adding that the company "must not go down a path of strikes from which there is no return."


kwater@heraldcorp.com