Due to Shortage of Work
Renault Samsung’s Busan plant will be shut down for 11 days from April 30 to May 10. It is the plant’s second shutdown in two months after it was closed for four days in February due to a shortage of Chinese-made wiring harnesses.
The company explained that the lockdown is intended to give employees a long rest as there are consecutive holidays at the beginning of May, which is Family Month in Korea. But industry experts say that the real reason may be a shortage of work following the end of contract manufacturing of the Nissan Rogue.
Renault Samsung recorded 12,000 units in sales in the domestic market in March, an increase of 83.7 percent compared to the same period of 2019, thanks to the popularity of the new compact sports utility vehicle (SUV) XM3. However, exports decreased 57.4 percent over the same period to only 3,080 units due to the sharp drop in the Rogue production volume. Since Rogue production will come to an end in April, the export volume of the Busan plant is expected to decrease to about 1,500 units in April, half of the March figure.
The problem is that there may be additional plant shutdowns due to a demand cliff. Industry experts expect the worldwide vehicle demand decline to continue into the second quarter or even the second half.