It's that time of year again – Hyundai Motor and Kia Motors workers this week voted in favour of strike action after management and unions failed to reach an agreement on wages.
The two automakers are making preparations for another summer of strike action, less than one year after agreeing a pay deal with unions following a series of strikes that disrupted operations throughout the third quarter of last year.
Earlier this week around 84% of Hyundai Motor's unionised workers voted in favour of strike action after the company refused to budge on its current wage freeze stance following a 7.3% drop in second quarter global sales to 1,105,000 units. This was mainly due to sharply lower sales in China, however.
South Korea's leading carmaker reported an more than 11% increase in global revenues to KRW21,027bn (US$17.8bn) in the second quarter, reflecting a richer product mix following the recent launch of new SUVs including the Palisade.
Its union is demanding a KRW123,526 ($105) monthly salary increase per worker for the year ending in March in 2020 and a bonus package equivalent to 30% of the company's net earnings for the year to March 2019.
The National Labour Relations Commission is scheduled to mediate in the labour-management dispute on 1 August but union workers typically call for strike action ahead of any decision by the commission.
If the company and unions fail to reach a compromise, strike action will likely follow from early August.
In a similar co-ordinated move, union workers at sister company Kia Motors voted 83% in favour of strike action on Tuesday after management last week refused to accept the union's wage demands which are similar to those demanded by Hyundai unions.
Unions rejected Kia management's offer of a KRW38,000 ($32) monthly basic pay increase, a 150% performance related monthly increase and a cash bonus of KRW1.7m per worker.