Huge Loss from Strikes
Hyundai Motor Company union members decided to go on partial strike soon. Kia Motors union members take a vote on August 8.
The Hyundai Motor Group’s production activities will be temporarily stopped for the sixth consecutive year once the two unions go on strike this year. This is quite contrary to the case of SsangYong Motor, in which employers and employees reached an agreement last month for no strike for the eighth consecutive year. Industry experts point out that the successive strikes in the Hyundai Motor Group is significantly reducing the competitiveness of the automobile industry of South Korea with the group having a dominating presence in the industry.
The strike that was repeated from 2012 to 2016 resulted in a production loss of 342,000 and 278,400 vehicles on the part of Hyundai and Kia during the period, respectively. These numbers are equivalent to 7.3 trillion won (US$6.5 billion) and 5.05 trillion won (US$4.5 billion). Last year, the union members staged an all-out strike for the first time in 12 years to extend the duration of their strike to 24 and 23 days each and cause a production loss of 3.1 trillion won (US$2.7 billion) and 2.2 trillion won each (US$1.9 billion).
Under the circumstances, India emerged as the fifth-largest automobile manufacturing country in the world last year by beating South Korea, which never lost that position in 2005 to 2015. South Korea’s car manufacturing volume fell from 4.52 million units to 4.23 million units between 2015 and 2016. About 80% of the decrement was attributable to Hyundai and Kia union members’ strikes.