Cooperation promoted by union chief

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Cooperation promoted by union chief

Hyundai Motor’s labor union called for collective efforts to recover production rates after the coronavirus outbreak prompted the automaker to temporarily shutter its factories.

It is a rare change in stance for one of Korea’s fiercest labor unions, which has repeatedly clashed with the company - Korea’s largest auto manufacturer by sales - on a range of issues.

Unionized workers announced Wednesday in a newsletter, titled “The coronavirus cannot break our union’s will to survive,” that employees must remain focused on ensuring the survival of the company by working with management to manufacture high-quality cars.

“If there are no customers, the company can’t survive,” the union said in the Wednesday newsletter. “Management must bring out everything it has to ensure all parts can be supplied, while unionized workers should work on recovering production.”

The local auto industry has been hard-hit by the spread of the new coronavirus, as domestic manufacturers were forced to halt production last week due to a parts crunch tied to subcontractors in China. The supply shortage was mainly centered on the wiring harness, which acts as the vehicle’s nervous system.

Hyundai Motor started closing down its domestic factories starting last Tuesday. By Monday, all of its factories had closed. Hyundai Motor Group has three suppliers of wiring harnesses, all headquartered in Korea. But they all have production in China.

The company has not released any exact figures related to its losses from the shutdown, but experts have suggested that Hyundai Motor Group could lose around 600 billion won ($509 million). The supply crunch has disrupted production for already delayed deliveries for popular models like the Genesis GV80 and the Palisade SUV.

“Our labor union members must not be stubborn in the call for our own survival,” the newsletter said. “The management should understand our stance and refrain from unnecessarily provoking the union members.”

Hyundai Motor workers in December elected a moderate labor union leader known to favor compromise over hard-line protests. Hyundai Motor was known for having conflicts with its labor union each year due to disagreements on wage levels and working conditions.

Immediately after his December election, labor union chief Lee Sang-soo said he would refrain from taking unnecessary collective actions, signaling a major shift for the automaker.

The union has also been facing the looming prospect of mass layoffs, as an advisory committee advised Hyundai Motor in October to cut its workforce by up to 40 percent by 2025 to keep its head above water.

Hyundai Motor’s domestic factories resumed operations Tuesday after auto parts from China started coming in.

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