The talks come as automakers face pressure from the Middle East war and U.S.-driven tariff impacts, and as global rivals intensify productivity competition. Industry officials have warned that conceding to union demands could weaken Hyundai’s competitiveness.
According to the business community on Tuesday, Hyundai Motor management and labor held an opening meeting at 10 a.m. at the company’s Ulsan plant to set bargaining direction and a schedule. About 60 people attended, including Hyundai Motor representative Choi Young-il, Korean Metal Workers’ Union Chairman Park Sang-man and Hyundai Motor union branch chief Lee Jong-cheol.
A central issue is the size of the performance bonus. The Hyundai Motor union is seeking 30% of last year’s net profit, while the Kia union is seeking 30% of operating profit. That is higher than demands by unions at Samsung Electronics and SK hynix, which have called for bonuses equal to 15% and 10% of operating profit, respectively.
Hyundai Motor’s net profit last year was 10.3648 trillion won. A simple estimate puts a 30% bonus at more than 3 trillion won. If the union proposal were fully reflected, employees could receive about 60 million won each, exceeding last year’s 40 million to 50 million won level (a 450% bonus plus a one-time payment of 15.8 million won).
The company is also grappling with falling productivity at domestic plants. Last year, Hyundai Motor’s Ulsan plant recorded an HPV — hours per vehicle — of 28 hours, about 60% of the U.S. plant’s 18 hours. HPV measures labor time needed to build one vehicle and is a key productivity indicator. Rivals including Toyota Group at 16 hours, GM at 20 hours and Tesla at 10 hours all posted better HPV figures than Hyundai Motor.
Other union demands could further complicate negotiations, including a full monthly salary system, raising bonuses from 750% to 800%, shorter working hours without increased work intensity, and extending the retirement age linked to the start of National Pension benefits, up to 65. The Hyundai Motor union’s conditions tied to rebuilding Plant 1 are also seen as a potential flash point. The union is seeking job guarantees and what it calls fair transfers across all plants.
Kia’s union, which is expected to hold its own opening meeting soon, is also calling for mandatory consultation with the union when introducing new technologies such as AI and robots. With the union seeking to discuss wages, working hours, retirement age, employment, new technology, and facility investment as a broad “package deal,” concerns are growing that this year’s talks could be more difficult.
* This article has been translated by AI.
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