Desperate Efforts to Save Company
SsangYong Motor Co. announced on Dec. 19 that its additional business reform plan is under an internal consent procedure. According to the plan, employees’ 200 percent bonus will be returned along with production incentives and the pay for unused annual leave will be reduced from 150 percent to 100 percent.
The management and employees of the company agreed on a similar plan in September this year. The additional business reform plan is a follow-up for ensuring its survival and future competitiveness.
The plans are based on the two sides’ common awareness of their dire situation. The automaker remained in the red for 11 quarters in a row after an operating loss of 15.5 billion won in the first quarter of 2017. Its loss amounted to 105.2 billion won in the third quarter of this year. Under the circumstances, the company is in no position to release a new car. The lack of new products has led to a drop in sales, which has resulted in financial difficulties.
In the past, unionized SsangYong Motor workers were classified as typical militant union members. For instance, they locked their factory in 2009 to continue with their strike for no less than 77 days and the company was on the brink of shutdown.
After the unprecedented crisis, India’s Mahindra Group took over the company in 2010 and the workers changed their stance. The company has been strike-free all the way since then.