Due to Prolonged Labor Dispute
Renault Samsung Motors has lost manufacturing of 24,000 sports utility vehicles (SUVs) to Nissan’s plant in Kyushu, Japan. As the Korean carmaker’s Busan factory failed to meet a deadline due to a strike, Nissan moved the production work to its Kyushu factory in Japan.
Nissan canceled its order for 42,000 Rogue cars placed on the Busan plant last month. Of it, 24,000 units were produced in Kyushu. Renault Samsung Motors has delivered 100,000 units of the Rogue to Nissan each year since 2014.
However, Nissan has begun to reduce its contract manufacturing volume as the labor dispute has continued. Renault Samsung Motors failed to deliver 4,600 vehicles to Nissan in time by March of this year. Nissan transferred the production work to the Kyushu plant, which has a production line for the Rogue, to prevent its global sales plan from being disrupted by the labor strike at the Busan plant.
In 2014, Renault Samsung Motors won a Rogue production order after defeating the Kyushu plant thanks to its low labor costs, but only five years later, the tables have been turned. During the five year period, the Kyushu plant's labor costs have become 20 percent lower compared to the Busan plant. Sources in the automobile industry say that Renault Group of France will also transfer its export amount to Spain from the Busan plant, following Nissan.