Renault Samsung Resumes Labor Negotiations, Adopts Cautious Mode for Now

[Asia Economy Reporter Kiho Sung] Among the five domestic automakers, Renault Samsung Motors, the only company that failed to conclude last year's wage and collective bargaining negotiations, will sit at the negotiation table again after four months. Both sides are emphasizing coexistence ahead of the negotiations, but there are concerns that if a tentative agreement is not quickly reached, it could lead to production disruptions of the XM3 (export name New Arkana), which has just started exports.

According to the automotive industry on the 7th, the Renault Samsung Motors labor and management will hold the main negotiations for the 2020 wage and collective bargaining today. This negotiation is the first since the 6th practical negotiation on September 17 last year.

For now, both sides are cautious. A company official said, "Last year, the management environment was difficult due to the novel coronavirus disease (COVID-19)," adding, "I understand that the union also shares this consensus."

Renault Samsung Motors' sales last year amounted to 116,166 units, a 34.5% decrease compared to the previous year. In particular, exports plummeted by 77.7% as the volume of Nissan Rogue, which was being produced on consignment, disappeared.

The union has also taken a step back. The union postponed the strike vote that was scheduled imminently. In addition, the one-person protests that had continued since last month have been temporarily suspended. The union has already secured the right to strike following the Central Labor Relations Commission's decision to suspend dispute mediation on October 16 last year. If a strike vote is held, they could immediately go on strike, but it is interpreted that they intend to refrain from direct action during the negotiations held after four months.

Through a newsletter, the union stated, "Both labor and management should avoid wasteful negotiations and focus on the stable production of XM3 European export volumes," and "We sincerely hope that this negotiation will be concluded quickly as a peaceful negotiation without disputes through harmony between labor and management."

Although negotiations begin after many twists and turns, it is uncertain whether they can be concluded smoothly. The biggest issue is 'wage increase.' The union demands a 71,687 KRW (4.69%) increase in the basic wage, which has been frozen for two years, a one-time payment of 7 million KRW in the name of overcoming COVID-19, and a contribution of 1.2 billion KRW to the union development fund. The sale of the Ilsan maintenance center (TS) is also an important variable. The company insists on selling it to reduce costs, but the union opposes it, fearing restructuring.

If labor and management fail to find a consensus and negotiations are prolonged, Renault Samsung Motors will inevitably suffer damage. Renault Samsung Motors was expecting a revival by securing XM3 export volumes from the European headquarters, but if labor-management conflicts are prolonged, this cannot be guaranteed. Moreover, if the union goes on strike around February, when production volumes increase, it is expected to face even more difficult circumstances.

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