Production losses reportedly mounted on Friday at South Korea’s two largest automakers, where factories have been forced into partial shutdowns during week-long strikes for higher wages.
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Hyundai Motor has lost 28,734 vehicles worth 396.2 billion won ($US386.2 million; €307.3 million) during its seven-day strike, company spokesman William Park told the Associated Press (AP).
Park reportedly added that a five-day walkout last year resulted in 18,994 vehicles in lost production worth 263.1 billion won – he added that the company has about a week of domestic inventory, or almost 16,000 vehicles.
Hyundai affiliate Kia Motors has lost 14,611 vehicles and 211.3 billion won in sales in its five-day strike, a company spokesman who asked that he be identified only by his surname Kim, told AP.
The report said workers at the two companies have been laying down their tools for several hours each day – Hyundai and its union say they want to settle their dispute before the beginning of Korean Thanksgiving on September 18.
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By GlobalDataAP added that Hyundai workers at Hyundai want more pay and better working conditions. Fearing job losses, they also are demanding more say in management decisions, including the expansion of production lines overseas. Kia’s union is seeking higher wages and incentive payments.
The news agency noted that Hyundai has four overseas plants – in Turkey, India, China and the United States – the latter facility, located in Montgomery, Alabama, began production in May [and was briefly shuttered by the recent Hurricane Katrina].
Analysts told the Associated Press the companies have more than enough extra inventory to ride out the strikes, seen in Korea as part of the annual negotiating process between labour and management.
“Overseas, Hyundai and Kia have enough inventory,” Hagju Kim, an auto analyst at Samsung Securities, told AP. Hyundai has 3.2 months of stock in overseas markets, while Kia has 4 months, he added.
Domestically, South Korean customers will maintain brand loyalty, he told the news agency.
The Associated Press noted that the Hyundai union has gone on strike every year but one since it was established in 1987. The government used rarely invoked powers to end a 1993 strike, and the union didn’t stage a walk-out the following year.
