Hyundai Motor expects to strike an amicable deal on wages with its labour union as the company is feeling the pain of the global economic crisis, it said on Friday.

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The automaker and its 45,000-strong union will begin annual wage negotiations on 10 April 10 with the union demanding a 4.9% increase in monthly basic salary this year.


“Unlike the past, this year’s wage negotiations won’t be counterproductive,” Hyundai Motor vice chairman Yoon Yeo-chul said on the sidelines of the 2009 Seoul Motor Show, according to the Yonhap news agency.


“Both sides should reach a mutually acceptable deal as they are both feeling the (effects of the) global crisis,” Yoon said.


Poor labour relations are considered one of the big hurdles for Hyundai in its efforts to become one of the world’s most competitive automakers. Strikes have been an annual ritual during Hyundai’s wage talks.

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But, in a sign that relations are improving, the union agreed last month to adjust production lines to boost output of small cars.


In March, Hyundai’s vehicle sales dropped 9.8% to 233,443 units, marking the fifth consecutive monthly fall.


In the first three months of this year, its sales declined 13.5% to 616,325 units, the company said earlier.


Separately, officials at affiliate Kia Motors said the company would hold talks with its union to scale back employee benefits to save cash.


Kia also plans to temporarily suspend production of its Carnival (Sedona) minivans and Pride compact cars for as many as five days this month, according to the company officials.