[OUTLOOK]This time, Japan could be right

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[OUTLOOK]This time, Japan could be right

Even a decade ago, a Japanese expert on the car industry predicted Korea’s carmakers would soon collapse due to an oversupply of cheap products.
That forecast proved to be wrong. Instead of collapsing, Korea’s motor industry has advanced on the global level, almost equal to Japan’s or Germany’s. The Japanese expert even published a book and gave a hasty forecast. When his predictions didn’t come true, he really lost face.
That “expert” failed to see the quality of Hyundai Motor. Although workers have not done their best, staging frequent strikes, Hyundai cars have been selling and profits have been increasing. He was wrong to say the company would go under.
Even though conflicts between labor and management have disrupted the company, once production lines start working, vehicles have sold like hot cakes. Nobody could say that the company has not been able to sell cars due to strikes.
Every time there was trouble, demands by the labor union were met and the company did as the workers wanted. But still, the company was working fine. Who could find a problem with that?
The company performed this miracle despite high wages and frequent strikes. What secret recipe does Hyundai Motor have?
Nobody knows whether the company forced car-part manufacturers to make sacrifices or used some other means. But it is clear that Hyundai Motor has been one of the leading companies in terms of business performance so far, and Korea has been proud of the automaker.
However, Japanese car experts are said to be sure that Korea’s auto industry will collapse this time. They do not make it public because they had a humiliating experience with such claims already. But it is said that a forecast that Korea’s auto industry will fail has circulated widely among Japanese people in the business.
The outline is that Korea’s auto industry is running full speed on a course toward collapse. Neither the Korean government, businesses, or labor unions are doing anything to avert a collapse, so one is inevitable, the scenario concludes.
When asked why the forecast released a decade ago turned out to be wrong, a Japanese expert answers that back then, Korean unity and power were underrated.
He continues that such unity and power are long gone, and that the workplace is turning into a battlefield.
This is supposed to be a major change compared to 10 years ago. The expert asks, “Don’t you think such a business will fall sooner rather than later?
Even before Japanese experts presented such a gloomy forecast for our auto industry, we have long been worried about the future of Hyundai Motor.
If Korean vehicles become more expensive than Japanese ones, and cars from China and India start pouring into our market, how can our domestic automaker survive?
The fate of a company where unionized workers stage frequent strikes instead of working as if their lives depended on it is obvious.
Day after day, the media carry stories about top U.S. automakers working through their difficulties, German car makers restructuring and even Toyota tightening its management. Only Korea’s auto industry is busy with conflicts and fights between labor and management. There can be no excuse for that.
Coincidentally, or rather ironically, Hyundai Motor’s labor union has come to have the enormous power and prestige that it enjoys today mainly due to the help the union received from President Roh Moo-hyun when he was a politician in the early years of the Kim Dae-jung administration.
Mr. Roh went to an Ulsan factory where a dispute occurred. He blocked law enforcement and took sides with the labor union, changing the situation drastically. In line with his earlier work as an advocate for workers, he was still fighting for unfairly treated workers. After that, President Roh often talked proudly about his mediation between management and labor.
What does President Roh think when he looks at the situation at Hyundai Motor these days? Now Korea’s auto business is running full speed toward a fall. Wouldn’t now also be a good time to visit the factory where the strike is taking place and mediate the conflict?


*The writer is the CEO of the JoongAng Ilbo News Magazine.

by Lee Chang-kyu

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