Korail strike reduces freight shipments by 65%

Social Affairs

Published: 11 Dec. 2013, 22:17

Korail strike reduces freight shipments by 65%

The Korean Confederation of Trade Unions holds a press conference at Jeong-dong in central Seoul yesterday protesting what they call a stealthy privatizing of the high-speed rail system. They also protested Korail’s suspension of more than 5,900 workers in a strike that has continued for three days. [NEWS1]

A strike at the state-run railway operator Korea Railroad Corporation (Korail), which was in its third day yesterday, took its toll on the movement of freight across the country and showed no signs of resolution.

The Ministry of Land, Infrastructure and Transport said 54 percent of railroad engineers walked off the job to support the strike and expressed concerns about the impact on freight services. Over the three days, freight transport shrunk to as low as 35 percent of the normal volume.

Only 91 of 259 scheduled freight trains ran yesterday. The volume of cement transported through Korail’s freight system was reduced to 9,800 tons from the usual 22,000 tons per day.

But commuter services were only affected slightly after Korail dispatched the vast majority of its substitute workers to assist in passenger services.

The strike was spurred by the company’s decision to introduce a separate operator to run a new Suseo KTX line that will open in 2015. Union members accuse Korail of attempting to pave the way for privatization by diversifying its structure. They maintain that privatization will lead to poor service quality, fare hikes and layoffs.

Korail says the new subsidiary has nothing to do with privatization and that it has no intention of privatizing the public railway company.

To try to placate the union, Minister of Strategy and Finance Hyun Oh-seok reaffirmed that the government and Korail won’t sell shares in the new operator to private entities.

“When the new operator oversees the operation of the Suseo KTX line, we won’t allow it to sell shares to private sector companies,” Hyun said yesterday.

He said the setting up of the new subsidiary is intended to boost competitiveness and reduce the financial burden on the debt-ridden public company.

“The launching of the separate operator will help turn around Korail, which carries 17 trillion won ($16.2 billion) in debt,” the minister said, adding that workers should return to work.

Korail’s board approved the forming of the new subsidiary Tuesday. Korail will own 41 percent of the shares of the new operator and the rest will be bought by public sector companies.

The rift between unionized workers and Korail only intensified after the company suspended workers involved in the strike.

It announced that more than 5,900 workers have been suspended from their positions. If the suspensions continue for six months, the workers will be removed from their posts.

Korail said the suspensions can be lifted if union members express their intention to go back to work. Some 400 workers had returned to work as of press time.

The controversy began when the city’s urban development committee confirmed plans to build a new KTX line in 2012 connecting Suseo to Pyeongtaek, Gyeonggi and Busan by 2015.

The line will have an entirely new route between Suseo and Pyeongtaek, although the rest of the trip will be identical to current KTX lines.

Conflicts will continue to rise in the railway company as the union of Seoul Metro, which operates subway lines 1 through 4 in Seoul and part of Gyeonggi, also decided to go on strike on Dec. 18.

BY PARK EUN-JEE [ejpark@joongang.co.kr]