Hyundai Motor Launches First Full Strike in a Decade, Industry Faces Challenges

Hyundai Motor has initiated its first full strike in a decade, raising concerns about its sales in the second half of the year.
 
According to industry sources and Yonhap News on August 19, negotiations between Hyundai and its labor union failed to reach an agreement during the 16th round of talks held the previous day at the Ulsan plant. As a result, the union began a five-day strike starting today.
 
The union plans to conduct four-hour partial strikes on August 19-20 and August 24-25, followed by an eight-hour full strike on August 21. This marks the first full strike by the Hyundai union since the collective bargaining negotiations in 2016.
 
The ongoing wage negotiations have faced significant challenges, leading to a cumulative production halt of 88 hours so far this year. The union has conducted partial strikes three times since July 13, including actions on August 12-14.
 
Considering Hyundai's separate sales and domestic production figures from last year, the estimated selling price per vehicle is 42.65 million won. Given last year's production numbers and working days, Hyundai is currently estimated to have lost about 40,000 vehicles in production, resulting in a revenue loss of approximately 1.7 trillion won.
 
If the production lines are halted for 48 hours due to the strike starting today, the total production loss is expected to reach 62,000 vehicles, with a revenue loss of 2.6 trillion won.
 
The ongoing strikes have raised concerns about Hyundai's sales performance in the second half of the year. For instance, the wait time for the Kona model has already increased to three to four months, likely due to the impact of the strikes. Hyundai is also facing potential production delays for the new Avante and Tucson models, which are set to launch in the second half of the year.
 
The strike wave is also spreading in the steel industry. Posco's labor and management failed to narrow their differences in wage negotiations, leading to the cessation of mediation by the Central Labor Relations Commission. Consequently, the union has secured the right to strike for the first time since the company's founding in 1968. The union is demanding a 7.1% increase in base salary, but the company has expressed difficulties due to challenging business conditions.
 
However, the union has decided not to strike immediately and will continue negotiations with management. Posco's union has begun preparations for partial strikes in September, including selecting target locations. The union plans to outline the timing, methods, and intensity of phased collective actions, including partial strikes, through its strike preparation committee.