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GM Korea, union to meet next year after wage talks collapse

All News 15:21 October 11, 2019

SEOUL, Oct. 11 (Yonhap) -- GM Korea Co. and its labor union will meet early next year as their wage negotiations collapsed this week due to differences over wages, the company said Friday.

The company and the union have held 10 rounds of wage talks this year but failed to bridge the gap running deep between them over wages.

The 10,000-member union declared there will be no further wage negotiations with the company this year at the end of the 10th talks held Thursday, the union said on its homepage.

As a new leadership will replace the current one in a vote to be held later this year, the company expects to resume talks with the new leadership early next year.

Asked about its official stance about the collapsed talks and expectations about the halted wage deal, GM Korea said in a text message: "We will keep negotiating with the union. We are committed to reaching a fair and reasonable agreement based on mutual respect and understanding."

The union could not be reached for comment.

GM Korea workers demanded a 5.7 percent hike in basic monthly salary, 1 1/2 months of wages in performance-based pay and a cash bonus worth 6.5 million won (US$5,400) per worker, which was rejected by the company.

The South Korean unit of General Motors Co. (GM) said it is difficult to accept the union's demand due to worsening business environments and the fact that the company is still mired in deficits, among other reasons.

From January to September, sales fell 9.5 percent to 308,933 vehicles from 341,349 units a year earlier. It posted a net loss of 859 billion won (US$738 million) in 2018 after reporting 3.13 trillion won in accumulated net losses in the 2014-2017 period.

Partial and general strikes held this year resulted in about 20,000 vehicles in production losses, according to the union.

To revive sales, GM plans to introduce 15 new vehicles to the Korean market for the five years through 2023. It launched the U.S.-made Equinox and the upgraded Chevrolet Spark minicar last year.

The Detroit carmaker launched the midsize Colorado pickup truck in Korea late last month and the Traverse SUV early this month. It is also considering adding the full-size Tahoe SUV to the lineup to meet rising demand for SUVs.

The company operates three car assembly plants -- two of which are in Incheon, just west of Seoul, and one in Changwon, 400 kilometers south of the capital city. They have a combined output capacity of about 600,000 units.

GM shut down a car assembly plant in Gunsan, 270 km south of Seoul, in May last year due to a low utilization rate.

GM Korea, union to meet next year after wage talks collapse - 1

kyongae.choi@yna.co.kr
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