GM Korea said it was reconsidering its planned investment in its Bupyeong plant in Incheon in response to continued strike action by its unionized workers over wages, according to local reports at the weekend.
The company had been planning to invest in the production of a new model for local sale and export.
Go deeper with GlobalData
Unionised workers entered a new round of partial strikes on Friday, however, which was set to continue into the early part of this week, while also refusing to work overtime.
Union spokesman Roh Hyung-rae told reporters "the union will decide on Tuesday whether to continue strikes if the company does not make any concessions on this year's wage and collective agreement deal".
The union is demanding a basic pay increase of KRW120,000 (US$107) per worker, an annual bonus equivalent to four months' salary and an additional cash bonus of KRW6m (US$5,350). It is also demanding a new vehicle production plan for the Bupyeong No 2 plant for after 2022, to replace current models such as the Trax small SUV and Malibu sedan.
GM has offered a cash bonus per worker of KRW7m (US$6,240) for 2020 as long as the union agrees to biennial wage negotiations. The last wage agreement was reached only in March of this year.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataGM Korea global sales declined by 12% to 300,352 units in the first 10 months of 2020 despite the introduction of several new models over the last year, with demand significantly affected by the COVID-19 pandemic.
Its second largest shareholder, Korea Development Bank (KDB), said ongoing industrial action would impact the company's efforts to put its business back on track after many years of losses. A spokesperson for the state run bank said: "GM Korea is at the critical juncture of producing more vehicles for export to the United States and of developing a new vehicle model. But repeated strikes continue to weigh on its operations."
