Unreasonable Demands
GM Korea's labor union finalized its wage and collective bargaining demands for 2021 in an extraordinary meeting of delegates on April 26. They demanded a basic salary raise, various allowances and lump-sum payments.
In basic salaries, the labor union followed the Metal Workers’ Union of the Korean Confederation of Trade Unions by demanding a monthly increase of 99,000 won. On top of that, the unionists demand 150 percent of ordinary wages as their performance-based bonuses and four million won in incentives. They also asked for a new customer service allowance (10,000 won) and an allowance increase of 10,000 won for some positions.
The labor union also plans to ask GM of the United States to allocate work for electric vehicles and new models to GM Korea. They will demand that GM make a promise to produce more than 230,000 units annually at Bupyeong Plant 1 and allocate electric vehicle production work to Bupyeong Plant 2. They will also demand that GM Korea reinstate laid-off workers during labor disputes and raise the cost of weekday meals by 450 won per meal and withdraw its plan to close down an auto parts logistics center that the management is preparing to.
In the auto industry, some analysts say that GM Korea's labor union is making unreasonable demands. GM Korea logged operating losses for seven consecutive years from 2014 to 2020. It posted a deficit of 316.9 billion won in 2020. GM Korea continued to make various efforts to rack up a surplus, but recorded a deficit similar to that of the previous year (a deficit of 330.5 billion won).
"Mid-sized automakers producing cars in Korea such as GM Korea are losing ground little by little in competition with Hyundai Motor, Kia Corp. and foreign automakers," an industry source said. "If they lose more in the future, they will face a situation to worry about their survival. It doesn't make sense for the GM Korea labor union to demand more production volume while demanding a pay raise at a time when automakers around the world are going through painful restructurings.
"If the union continues to make unreasonable demands, both labor and management will face more difficulties," an analyst said.