The union representing GM Korea assembly line workers voted to approve a new labor agreement this week, avoiding further daily strikes at the automaker’s two assembly plants.
The Korean labor union had previously rejected a contract proposal put forth by GM Korea, with only 45 percent of workers voting in favor of the initial tentative agreement. That sent union leaders and GM Korea representatives back to the negotiating table for the 26th time since July, Automotive News reports. After agreeing on a new tentative contract last week, the union has now voted 54 percent to ratify it, paving the way for regular production to return at the automaker’s various production facilities in the country.
Under the new agreement, GM will give workers a lump-sum payment worth four million won (about $3,600 USD) by the end of 2020 and will also raise vehicle discount rates for employees and their families. According to AN, GM rejected the union’s demands to raise the retirement age from 70 to 65 and was unable to secure future products for its South Korean plants.
GM currently builds the Buick Encore, Chevy Trax, Chevy Trailblazer and Buick Encore GX crossovers at the GM Bupyeong Assembly plant in South Korea, while the Chevy Spark hatchback is produced at the smaller Changwon Assembly plant in the southeastern part of the country.
GM Korea workers were staging two daily four-hour strikes in recent months as they sought increased yearly bonuses and new vehicle allocation for the two assembly plants. Steve Kiefer, president of GM international operations, expressed the automaker’s anger with the situation earlier this month, saying GM may have to look elsewhere in the future to build some products due to the constant labor relations issues in South Korea.
“We’re basically being held hostage in the short term by lack of vehicle production,” Kiefer said at the time. “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).”
With a new labor deal done, GM can once again rely on its South Korean plants to churn out strong production numbers for crucial new models like the Encore GX and Trailblazer.