Daily strikes at GM Korea assembly plants are set to continue after the majority of unionized workers rejected a contract proposal from the automaker.
According to Reuters, GM Korea and the local labor union agreed to a preliminary contract last week that would have seen the automaker’s assembly line workers receive a lump sum payment of about four million won, or roughly $3,600 USD, early next year. Only 45 percent of union members voted to ratify the contract, however, sending the automaker and the union back to the negotiating table for yet another time.
GM Korea and the labor union have held 24 rounds of negotiations since July, according to Reuters. Workers have been staging two four-hour strikes daily for the past two weeks as they demand a higher yearly bonus and new vehicle allocation at the automaker’s Korean plants. GM Korea workers also want to sign a one-year work contract rather than the two-year deal the automaker has proposed.
Steve Kiefer, president of GM international operations, said last month that persistent labor relations problems in South Korea may force the automaker to look elsewhere when deciding where to build certain vehicles in the future. The automaker said previously that strikes in the past two weeks have cost it 25,000 vehicles in lost production – a particularly costly problem when vehicle inventories were already low due to the COVID-19 pandemic earlier in the year.
“We’re basically being held hostage in the short term by lack of vehicle production,” Kiefer said. “That’s having a very significant short-term financial impact.”
“We would prefer to make this model work but as of now, we’re losing confidence that we’re going to be able to continue to invest in (South Korea).”
GM currently builds the Buick Encore, Chevy Trax, Chevy Trailblazer and Buick Encore GX at its Bupyeong Assembly plant in South Korea, while the Chevy Spark hatchback is produced at the smaller Changwon Assembly plant in the country.
Discussions between GM Korea and the labor union remain ongoing.