Hyundai Transys strike ends as executives agree to return 20% of salaries

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Hyundai Transys strike ends as executives agree to return 20% of salaries

Published: 11 Nov. 2024, 15:42

SARAH CHEA
[email protected]

Audio report: written by reporters, read by AI

Hundreds of Hyundai Transys workers stage a protest in front of Hyundai Motor's headquarters in Yangje, southern Seoul, on Oct. 28. [JOONGANG ILBO]

Executives at Hyundai Transys agreed to return 20 percent or their annual salaries as a part of efforts to normalize management after a monthlong plant shutdown due to discord with its labor union.

The auto parts maker's labor union returned to work on Monday after calling off the strike on Saturday, which extended from Oct. 8 at its transmission plant in South Chungcheong after 15 rounds of failed negotiations.

"Hit hard by the shutdown of the plant, Hyundai Transys faced the most serious crisis since its foundation," said company CEO Steve Yeo in a statement, announcing the activation of an “emergency management system" to normalize the supply chain and defend profitability.

"Executives feel strongly responsible for the situation and agreed to return 20 percent of their salaries," Yeo added. "We cannot overcome this crisis with just a small effort, but can tackle this if we work all together with a shared goal."

Impacted by Transys' strike, Hyundai Motor had to halt production at its No. 1 plant in Ulsan for four days from Nov. 5 to 8 due to the shortage of auto parts. The impacted model was the Kona SUV.

It was first time in six years that the country's largest carmaking facility stopped production.

Hyundai Transys, a transmission and car seat maker 41 percent owned by Hyundai Motor, produces over 4 million transmissions a year. Around 80 percent of its sales come from Hyundai and Kia.

The labor union is demanding a basic salary increase of 159,800 won ($116) next year and 2 percent of the company's total sales as incentives.

The company refused the demand, citing a low operating profit margin. Two percent of the total sales amounts to 230 billion won, double the company's total operating profit last year.

"No schedule has been set for the next negotiation with union, but we will make every effort to conclude the negotiation shortly," a spokesperson for Hyundai Transys told the Korea JoongAng Daily.

BY SARAH CHEA [[email protected]]