Foreign Auto Labor and Management at a Crossroads... Will They Reach an Agreement Before Summer Vacation?

Korea GM Union to Count Votes on Tentative Agreement on the Afternoon of the 27th
Renault Samsung Continues Negotiations Amid Management's Proposal of '8 Million Won Lump Sum'

[Asia Economy Reporter Yu Je-hoon] Foreign-affiliated completed car labor and management are at a crossroads ahead of the summer vacation. As production disruptions due to the shortage of vehicle semiconductors and lack of work caused by reduced sales tighten the foreign-affiliated completed car companies, attention is focused on whether each labor union and management can finalize wage and collective bargaining negotiations before the summer vacation.

According to the related industry on the 27th, the Korea GM labor union has been conducting a two-day vote on the tentative agreement for this year's wage negotiations since the day before. The Korea GM union plans to complete the voting and proceed with the counting process by the afternoon of the same day.

The Korea GM union once escalated its offensive level, including partial strikes, but recently succeeded in preparing a tentative agreement with the management, including a basic wage increase of 30,000 won (including seniority increments) and a bonus payment of 4.5 million won.

Korea GM's main model, the Trailblazer, performed well by recording the number one domestic completed car export last month (15,165 units), but due to the shortage of vehicle semiconductors, it suffered production disruptions of about 80,000 units in the first half of the year, making the path to turning a profit still far away. This is why both labor and management hurried to prepare the tentative agreement.

Renault Samsung labor and management are also at a crossroads. With last year's wage and collective bargaining negotiations unresolved and ongoing negotiations to date, Renault Samsung labor and management resumed main negotiations on this day and continued discussions on the management's proposal. Both sides are continuing negotiations aiming to reach an agreement before the summer vacation.

At the 11th main negotiation held the day before, management presented a dramatic proposal of a lump sum payment of 8 million won. This was an addition of a 2 million won compensation for freezing the basic wage and a 1 million won bonus on top of the existing proposal (5 million won lump sum). Considering that the company recorded a deficit of 79.7 billion won last year and domestic sales volume has halved, the industry evaluates that this is the maximum amount management could offer.

For Renault Samsung, production stabilization is above all important. This is because the 'New Arkana (the European export name of the XM3),' which holds the fate of Renault Samsung, is showing signs of success in Europe, causing export volumes to surge. An industry official said, "While experiencing a lack of work after the suspension of Nissan Rogue production, the XM3 is Renault Samsung's only lifeline," adding, "It is important to achieve production stabilization through a swift negotiation settlement."

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