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Unions of Hyundai Motor, Kia authorize strikes

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(Globalpost/GlobalPost)

ULSAN, Aug. 14 (Yonhap) -- Tens of thousands of unionized workers of Hyundai Motor Co. and Kia Motors Corp. have voted in favor of striking, officials said Wednesday, setting the stage for another walkout that may cut the carmakers' vehicle output.

Still, the unions are not allowed to down tools immediately as they were meeting with the managements on Wednesday as part of the mandatory mediation that the unions requested after their negotiations with the managements collapsed last week.

By law, a union cannot go on strike during the mediation by the state-run National Labor Relations Commission, which usually lasts 10 days.

The commission said its mediation is set to end on Aug. 19 when it can ask the labor and management to either hold more negotiations or halt its mediation, meaning the workers could walk off the job anytime starting Aug. 20.

The latest development comes as Hyundai is struggling with a short supply in the United States, the second-largest market for the carmaker after China.

A possible strike could have a negative impact on sales in the U.S., where Hyundai ships about half of the cars made in South Korea, according to a Hyundai official who requested anonymity, citing company policy.

Kwon Oh-il, a spokesman for the Hyundai union, said the authorization to strike is an expression of outrage by the union toward the company, though he said the union can sit down for talks with the management if the company offers acceptable deals.

"Our goal is not a strike," he said, adding that "the company should offer positive proposals if it does not want a disruption" at assembly plants in the country.

His comments came hours after the union said 70 percent of more than its 46,000 members authorized a strike.

Hyundai runs three assembly plants in South Korea and several others in China, the United States, India, Turkey, the Czech Republic, Brazil and Russia. In 2012, Hyundai produced 1.91 million vehicles in South Korea, compared with 2.5 million units built at its overseas plants.

Last year, Hyundai Motor's union workers staged a 13-day strike, preventing 82,000 vehicles from being produced, which cost the carmaker some 1.7 trillion won (US$1.5 billion) in lost production.

Kia Motors' union workers also went on strike last year for 12 days, leaving Kia with 62,000 less vehicles and 1.03 trillion won in lost production.

Hyundai's unionized workers have downed tools every year due to wage disputes since 1986, except in 2007, 2009, 2010 and 2011, according to the carmaker.

Kia's union went on strike every year except in 2010 and 2011 since 1999, when the country's No. 2 carmaker was taken over by Hyundai following the 1997-98 Asian financial crisis.

Hyundai's management called for a quick resumption of in-depth negotiations to conclude a wage deal.

"We can ill afford friction between the labor and management," a Hyundai official handling labor issues said of the company's recent official letter to the union calling for the resumption of talks on Friday.

He described the latest development as a crisis, citing growing market shares of foreign cars in South Korea and the prolonged economic slowdown.

Separately, more than 21,500 out of 30,486 Kia union members also voted in favor of a strike.

Kia union said it had no immediate comment on the looming work stoppage.

Meanwhile, Hyundai said it was recalling 239,000 Sonata and Azera sedans in the U.S. due to a problem with their rear suspension that can be corroded by road salt.

The news was first reported by the Associated Press in Detroit.

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