GM Korea’s union plans strike on pay

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GM Korea’s union plans strike on pay

A day after GM Korea revealed an ambitious goal to become the No. 1 domestic automaker in the compact segment with its Next Spark, the company’s labor union decided to strike over a pay raise.

According to industry sources, GM Korea’s union held a vote Tuesday and Wednesday to ask workers whether they should strike, and 70.8 percent of the 13,884 union members voted in favor. The union will await permission for the strike from the National Labor Relations Commission, which guides workers in labor issues including pay and unfair dismissals.

The nation’s third-largest automaker and its union have held 12 rounds of negotiations since April over the wage issue. The union is demanding the company raise the base monthly wage by 159,900 won ($142.01), and to give a yearly bonus of five months’ base pay. The union said the proposed raise was in accordance with a guideline provided by the National Labor Relations Commission. But the company says it is too much, and would not reveal the current base pay or what percentage that raise represents. It is not known how much the company has offered.

“This is the kind of a pressure that the union has been exerting every year ahead of the wage negotiation period,” said a spokesman of GM Korea. “It doesn’t necessarily mean that they will actually launch a strike immediately.”

But there are other issues GM Korea workers worry about. They said they fear the company may not have enough orders to keep all the workers on the job. GM Korea recently decided to stop producing the midsize sedan Alpheon in the third quarter. The car was produced at the company’s Bupyeong No. 2 plant in Incheon. The company decided to discontinue the Alpheon since only 5,000 units were sold in Korea last year and only about 200 per month this year.

In order to boost market share in the mid- to large-size sedan segment in the country, the company decided to sell sedan Impalas in the second half. The company will import that model from the United States, and workers are concerned about a restructuring of the workforce. The company said it can consider producing Impalas in Korea if annual sales of the model exceed 10,000 units, but the union believes that possibility is low considering the Alpheon’s poor sales in Korea.

In fact, company CEO Sergio Rocha said that the company has no plan to import the Impala from the United States at April’s Seoul Motor Show, but the decision was changed in only three months.

And since Chevrolet backed out of the European market last year, GM Korea, which was one of 15 international branches exporting GM cars to Europe, was directly impacted. According to industry data, the company’s exports dropped 24.4 percent last year from a year earlier, or from 629,478 to 476,151. The amount through May this year dropped by 10.4 percent from a year earlier.

But GM Korea’s Rocha said at the Spark launch event Wednesday that the company has no plans to cut its workforce.

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