Competitive Advantage
GM Korea is aiming to catch the reflected benefits from a strike at a competing company. In particular, GM Korea has a strategy to boost sales by launching four vehicle types within this month.
According to the related industries on August 21, the labor union of Kia Motors held a dispute management committee on August 18 and decided to go on partial strike at Gwangmyeong, Hwaseong, and Gwangju factories for four hours simultaneously. This is the first strike after wage negotiations failed this year. The strike might go longer, as the management and labor union cannot find a clue to solve conflicts regarding ordinary wages.
The labor union of Renault Samsung, which held a starting ceremony for the strike on August 18 to achieve promotion of employees in production lines and employment security, has suspended factory operations eight times so far, and is not discussing future strike schedules.
GM Korea, between Kia Motors and Renault Samsung, which are number two and four respectively in the Korean market, is quietly smiling because of potential reflected benefits from strikes at its competitors. GM Korea especially plans to launch the 2015 Chevrolet and Alpheon, Damas and Labo, living vehicles for low income people, within this month, while other automakers are suffering from conflicts with labor unions. This will leave number four Renault Samsung far behind and catch up with number two Kia Motors.
GM Korea also faced a strike crisis this summer, but wage negotiations reached a dramatic settlement last month, as the company proposes to include a regular bonus to ordinary wages, and to manufacture next generation Cruze at its Gunsan factory.
A GM Korea employee said, “Since the preliminary contracts late last month, orders for Damas and Labo already broke 2,000. Vehicles will be delivered to clients late this month.”