Wage Talks Are Over
Renault Samsung Motors and GM Korea are drawing up plans to overcome the COVID-19 crisis after wrapping up the drawn-out 2019 wage negotiations.
Renault Samsung is focusing on securing export contracts for the small sports utility vehicle (SUV) XM3, which sold 5,581 units in the domestic market in March, accounting for about 50 percent of the automaker’s total sales of 12,012 units. GM Korea has begun a real-time inspection of parts supply and other factors that can cause production disruptions. The company is determined to avoid production disruptions.
Renault Samsung plans to resume talks with Renault Group of France to export the XM3 to Europe. Earlier, Renault Group considered outsourcing the production of the Arcana, an export version of the XM3, to the Busan plant, but it put off a decision as frequent strikes by the labor union threatened production stability.
A Renault Samsung official said, "I think the conclusion of the wage negotiations has resolved concerns about production stability. Now, Renault Samsung will be able to secure an Arcana export contract." However, talks with Renault Group could be delayed due to the spread of COVID-19 in Europe.
Auto industry insiders believe that even if a deal is clinched on Arcana exports in the near future, production will be possible in October or November. In addition, Renault Samsung plans to release the Capture, the successor to the compact SUV QM3, in the first half of this year. It intends to continue the sales growth momentum generated by the XM3 through the launch of the Capture.
GM Korea will focus on keeping its plants running normally. “As most GM plants around the world have been locked down, GM Korea's importance is growing,” a company official said. “We are maintaining stability by checking parts supply on a daily basis and making utmost efforts to combat the novel coronavirus.”
Based on this, GM Korea plans to maintain the growth of domestic sales and exports achieved through the launch of the compact SUV Trailblazer. The Trailblazer has risen as a big hit while posting 3,187 units in domestic sales and 14,897 units in exports in March. At the moment, the ongoing pandemic is a factor to consider, but GM Korea plans to prepare for its business operations after the end of the novel coronavirus fiasco by minimizing production disruptions.