Last week, members of the Korean Metal Workers Union approved an annual wage contract with GM Korea that follows more than two weeks of partial strikes that affected GM’s Asian manufacturing base. GM Korea assembles about 40% of Chevy branded cars sold worldwide.
The contract was approved with 54.3% of the votes and it includes bonuses of 10 million Won ($9,000) and a no-layoff guarantee. During negotiations, the union expressed concerns that GM might downsize its footprint in Korea because of the announcement late last year that the next Chevy Cruze would not be assembled in Korea, as the current model is. When that announcement was made, GM CEO Dan Akerson sent a signal to the KMWU by publicly stating that ongoing labor strife in Korea was a factor in that decision. It is reported that GM management considers the KMWU to be the least cooperative labor union representing GM workers around the world.
From July 4 to July 23, GM Korea’s workers walked out, their longest strike in a decade, which resulted in 40,000 vehicles not getting built. GM Korea supplies most of GM’s cars sold as Chevrolets in Europe and is the company’s manufacturing hub for Asia and emerging markets as well as the center the design and engineering of GM’s small cars. GM Korea, formerly Daewoo, is also South Korea’s third largest automaker, after Hyundai and Kia.