Hyundai Motor union escalates strike action; management says strikes lead to mutual ruin and are not the way forward

[Financial News] Hyundai Motor Company's labor union has finalized plans for a four-hour partial strike by each shift next week, raising the prospect of further walkouts and bringing labor-management conflict into sharper focus as a risk factor.
According to industry sources on the 18th, the union held a meeting of its Central Strike Countermeasures Committee on the 16th and confirmed plans for a four-hour partial strike by each shift from the 20th to the 22nd.
This expands the scale of the partial strike after each shift carried out two-hour walkouts from the 13th to the 15th.
As a result, workers in Hyundai Motor Company's technical divisions on the morning and afternoon shifts will stop work and leave four hours earlier than usual, at 10:50 a.m. and 7:30 p.m., respectively.
The union made clear that it would intensify pressure through additional strikes while demanding a more forward-looking proposal from management and a resumption of talks.
It also said it would postpone strike action on the day if full-scale negotiations resume.
Even the previous partial strikes were estimated to have caused sales losses of more than 200 billion won on a simple arithmetic basis. With the expanded walkouts now totaling 12 hours across production lines, industry observers note that the impact could again amount to more than 200 billion won in lost sales. Last year, 16 hours of partial strikes led to production disruptions of about 7,000 vehicles and sales losses of more than 300 billion won.
Industry sources said that if Hyundai Motor Company carries out two-hour partial strikes for three days followed by four-hour partial strikes for another three days, production losses could reach about 15,000 vehicles, with sales losses estimated at around 650 billion won.
Compared with last year's partial strikes, which caused production disruptions of about 7,000 vehicles and sales losses of more than 300 billion won over roughly 16 hours, the damage could more than double year on year.
Despite these concerns, Hyundai Motor Company and the union have still failed to find common ground after 15 rounds of talks.
At the 15th round of negotiations on the 8th, management proposed a package that included a monthly base pay increase of 89,000 won, performance pay of 350% plus 10 million won, and 15 shares of stock. The union rejected the offer and went ahead with its strike plan.
The union is demanding a monthly base pay increase of 149,600 won, excluding regular seniority raises, performance pay equal to 30% of last year's net profit, and guarantees on employment and working conditions related to Artificial Intelligence (AI).
It is also calling for bonuses to be raised from 750% to 800%, the introduction of a 4.5-day workweek, a full monthly salary system, and the reinstatement of dismissed workers.
If the dispute is not settled before the summer vacation period scheduled for early next month, some observers warn that labor tensions could continue until the Chuseok holiday period at the end of September.
In response, Choi Young-il, CEO of Hyundai Motor Company, issued a statement on the 16th after the union decided on additional strikes. He said, "All that remains after a strike is accumulated production losses, wage damage and outside criticism." He added, "Wage negotiations are being pushed toward a strike, not because of their original purpose, but because they are being blocked by the union's pretexts, such as the reinstatement of dismissed workers, which is not a subject for bargaining, and demands for a higher retirement age and bonus increases, which are matters for collective bargaining."
Choi emphasized that management had put forward its best offer despite difficult conditions, including a 19.5% decline in operating profit last year and a 30.8% drop in operating profit in the first quarter of this year compared with the same period a year earlier. He appealed, "The path we should take is not the path of strikes and mutual ruin, but one in which Hyundai Motor Company, employees, parts suppliers, shareholders and all others coexist and grow together."
hjkim01@fnnews.com Kim Hak-jae Reporter