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Hyundai Motor Co., Ltd.‘s (OTC:HYMTF) unionized workers in South Korea reportedly voted in favor of potential strike action following stalled negotiations with the company regarding wage increases and the extension of retirement age.
The union, which counts over 43,000 members and ranks among the largest in the country, stated that nearly 90% of its members have voted in favor of striking unless Hyundai Motor agrees to comply with the union’s demands, reported Reuters.
The union is proposing a raise of 159,800 won ($115.14) in the minimum basic monthly pay and performance-based pay linked to 30% of Hyundai’s 2023 net profit.
Read: Hyundai Charges Ahead To Solidify Its EV Positioning Despite The Slowdown
The automaker’s union is also advocating for an increase in the retirement age from 60 to 64, citing South Korea’s rising life expectancy and the need for adequate retirement income.
As per the report, the strike has the potential to disrupt the production of several popular vehicles domestically, which Hyundai has been exporting to compensate for slow domestic sales.
If a strike occurs, it would be the first of its kind in six years concerning wage negotiations at the South Korean carmaker.
A Hyundai Motor union official told Reuters, “We are open to have negotiations with the management if they are willing to change their stance.”
They further mentioned that the union intends to proceed with working-level discussions with management.
As of mid-June, the union and management have conducted a total of eight rounds of wage negotiations.
As per the report, the analysts warn that such action would likely impact Hyundai’s short-term sales, particularly in the U.S., its largest market for revenue-generating vehicles.
The report cited Chang Moonsu, an analyst at Hyundai Motor Securities, who commented, “Hyundai Motor’s union at home has always voted for strike action every year and this year is no different, however, the union might push a bit harder than previous years as the company has been doing well and the pandemic is long gone, so workers would like to push for bigger compensation this time.”
Price Action: HYMTF shares are up 3.63% at $59.12 at the last check Monday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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Posted In: HYMTF
