[One Week of Cargo Solidarity Strike] Entire Industries Halted... Industrial Paralysis Due to Steel Material Delivery Disruptions

More Than Half of Construction Sites 'Closed for Business'
Automobile, Shipbuilding, and Home Appliance Companies Also Take a Direct Hit

On the 12th, products that could not be shipped are piled up outside the POSCO Pohang Steelworks factory in Jecheol-dong, Nam-gu, Pohang-si, Gyeongbuk.
[Image source=Yonhap News]

[Asia Economy Reporters Choi Dae-yeol and Jung Dong-hoon] As the Cargo Solidarity Union's strike enters its second week, logistics disruptions are spreading across key national industries. More than half of construction sites face the risk of 'temporary closure,' and industries such as automotive, steel, chemical, and shipbuilding?already hit hard by rising raw material costs and transportation disruptions?are inevitably suffering massive losses.

In particular, concerns are rising over the negative impact across the entire industrial sector as steel deliveries, which serve as basic materials for the entire manufacturing industry, are disrupted.

According to business circles on the 13th, POSCO has suspended operations at the wire rod mill and cold rolling mill of its representative domestic steel manufacturing plant, the Pohang Steelworks, starting today. A POSCO official stated, "With overland shipments completely halted, the product warehouses within the steelworks are nearly full," adding, "From 7 a.m. today, we stopped operations at the wire rod and cold rolling mills of the Pohang Steelworks." Currently, due to a shortage of warehouse space at the wire rod mill, products are being stockpiled in parking lots and roads within the steelworks. A production decrease of about 13,000 tons is expected, including approximately 8,000 tons of wire rod products and about 4,500 tons of cold-rolled products based on daily production volume.

As steel deliveries fail to arrive on time, the automotive, shipbuilding, and home appliance industries have also been directly hit. This affects the entire manufacturing sector, including automotive steel plates, shipbuilding heavy plates, and colored steel plates for home appliances. Especially in the automotive industry, already struggling with a shortage of vehicle semiconductors, the logistics strike has worsened the situation, causing daily production to plummet and sales losses to snowball. In the case of Hyundai Motor Company, it is reported that about 2,000 vehicles?roughly one-third of the daily production volume at the Ulsan plant?are affected by production disruptions.

To respond to the general strike by the Cargo Solidarity Union under the Korean Confederation of Trade Unions, the automotive industry formed and began operating a joint task force (TF) today. The TF was established within the Korea Automobile Manufacturers Association (KAMA), with Kim Ju-hong, head of KAMA's Policy Research Institute, appointed as team leader. Samsung Electronics and LG Electronics are also facing production and logistics disruptions in home appliances.

According to the Korea International Trade Association, as of 9 a.m. today, 160 cases of difficulties caused by the Cargo Solidarity Union strike have been reported. Of these, 55 cases (34.4%) relate to imports, including 25 cases (15.6%) of raw material procurement disruptions, 15 cases (9.4%) of production stoppages, and 15 cases (9.%) of increased logistics costs. Export-related issues accounted for a total of 105 cases (65.6%), making up more than half of the total.

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