[Click e Stocks] Has Hyundai Motor Changed? ... The Population Has Changed.

[Asia Economy Reporter Hwang Junho] "Hyundai Motor Company experienced a pattern until 2017 where labor-management negotiations broke down in July, followed by refusal of overtime and extra work, partial strikes, and full strikes starting in August, intensifying the strike actions. After continued confrontation until before Chuseok, wage negotiations were eventually settled."

It has been analyzed that the Hyundai Motor labor union, which had engaged in such hardline struggles, completing four consecutive years of wage negotiations without disputes, is a result of changes in the demographic pyramid and labor cost structure of its members.

Jinwoo Kim, a researcher in Gyeonggi Consumer Goods at Korea Investment & Securities, stated on the 21st, "Recently, Hyundai Motor's wage negotiations have been conducted more intensively with a tendency to reduce unnecessary strikes. This is not only due to a shared understanding between labor and management about the changing automobile industry and external environment but also because the union's culture is gradually changing."

He attributed this change in atmosphere to the shift in Hyundai Motor's demographic pyramid structure. Hyundai Motor has many long-term employees, with an average tenure of 19 years. Accordingly, the number of retirees reaching retirement age has sharply increased since 2018. The increase in retirees has led to expanded new hiring, and Hyundai Motor's workforce structure is expected to see the proportion of those aged 50 and above decrease from 44% last year to 39% in 2017, while the share of employees in their 30s is expected to rise from 10% to 12% during the same period.

Along with changes in the demographic pyramid, the proportion of labor costs is also decreasing. Hyundai Motor's labor cost ratio relative to sales rapidly rose to 9.6% by 2015 but has steadily declined to 8.2% last year. The ratio of domestic labor costs relative to separate sales is also projected to fall to 10.2% in 2024. Researcher Kim analyzed, "This is the result of not only cost reductions through platform integration and rapid sales growth but also improvements in workforce structure."

Due to these changes, the impact of labor-management conflicts on performance has lessened compared to the past. He said, "It signifies the alleviation of chronic discount factors for HyundaiKia Motors," adding, "the inclusion of the establishment of a domestic electric vehicle plant in the recent Hyundai Motor labor-management agreement is rather positive from an investor's perspective."

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