Renault Samsung, Is a 'No-No Conflict' Brewing This Time?

Union Executive Board Pushes for Joining Minnocho... Interest in Union Members' Response

[Asia Economy Reporter Kiho Sung] Renault Samsung Motors, which has been embroiled in a long-term internal conflict over wage negotiations, is now facing a 'No-No conflict' crisis. This is because the labor union executive committee is pushing for 'joining the Korean Confederation of Trade Unions (KCTU)' separately from the wage negotiations, which has sparked growing opposition. There is also increasing concern that if labor-management conflicts intensify again due to joining the KCTU, it could lead to mutual destruction, drawing attention to how union members will respond.

According to Renault Samsung Motors and industry sources on the 9th, the union executive committee at Renault Samsung Motors has decided to hold a general meeting of union members to join the KCTU and has begun to review the schedule and other details. Previously, the union executive committee announced through a newsletter that they would push for a general meeting to join the Metal Workers' Union but did not specify the schedule.

The Renault Samsung union has yet to conclude the 2019 wage negotiations, which have been ongoing since July last year. Although there was a discussion on the 3rd, no agreement was reached. The union still insists on its initial demand centered on a basic wage increase, while management maintains that it cannot accept this. Therefore, the union's renewed push to join the KCTU is analyzed as an attempt to gain stronger bargaining power. Park Jong-gyu, the current chairman of the Renault Samsung union, pledged to join the KCTU during the 2018 chairman election.

Industry insiders largely believe that labor-management negotiations will not be easily resolved even with the union's 'joining the KCTU' card. Within the union, there are also critical voices saying, "What was gained from the strike at the beginning of the year?" and "The entire industry is in an emergency due to the novel coronavirus disease (COVID-19), and with new car launches imminent, a hardline approach is not the solution."

For the union to realize joining the KCTU, it must overcome the hurdle of a 'union member vote,' but this is not guaranteed. In fact, the strike participation rate of the Renault Samsung union was close to 80% at the beginning of last year but dropped to the 20% range in the strike earlier this year. To join the KCTU, a majority of union members must vote, and at least two-thirds of the voters must approve.

There are also growing concerns that if production of the highly anticipated compact sports utility vehicle (SUV) 'XM3,' which goes on sale starting today, is disrupted, it could deal a fatal blow to this year's performance. The XM3 has shown signs of success, with 8,542 units contracted during the pre-order period.

An industry official pointed out, "Currently, Renault Samsung's labor-management issues are deeply connected to the export volume of the XM3," adding, "If labor-management and No-No conflicts intensify further due to joining the KCTU, it could provide the French Renault Group with a pretext for restructuring."

This content was produced with the assistance of AI translation services.