Automotive Industry Repeatedly Halting Operations... "Political Circles and Labor Unions Must Actively Support Normalization"

[Asia Economy Reporter Kiho Sung] The domestic automobile industry is struggling to recover from the aftermath of the spread of the novel coronavirus infection (COVID-19). Due to disruptions in the import of Chinese-made parts, factories are repeatedly halting and resuming production. Experts emphasize that active cooperation from labor unions is necessary, as this issue concerns not only policy support but also the survival of the entire automobile industry.

Experts pointed out that the situation at local factories in China remains severe. Professor Pilsoo Kim of the Department of Automotive at Daelim University stated on the 20th, "After the Lunar New Year holiday, workers who had gone to their hometowns in other regions are entering a 14-day self-quarantine period," adding, "Because of this, factories currently in operation are staffed only by those who stayed in dormitories during the Lunar New Year holiday and some workers who have completed self-quarantine, so full operational rates are not being achieved."

He continued, "This situation will persist until the complete normalization of Chinese parts factories," and noted, "At present, it is difficult even to estimate when normalization will occur." The industry reports that the attendance rate at Chinese parts factories is only about 60%.

Experts pointed out that since the situation in China is changing by the hour, extraordinary measures against COVID-19 must be taken. Professor Kim said, "We cannot rule out the possibility that the situation will prolong until this summer," and added, "Until now, we have been hoping for an improvement in the Chinese situation rather than immediately changing parts suppliers, but even now, we should consider diversifying parts suppliers."

Along with this, cooperation from automobile labor unions is also urgently needed. Currently, the Hyundai Motor irregular workers' union has begun a struggle for the regularization of in-house subcontracted employees. Additionally, the two major labor federations are jointly filing administrative lawsuits opposing the government's policy to expand special working hours.

Professor Hogun Lee of the Department of Automotive at Daeduk University explained, "Even if parts supply normalizes under the current 52-hour work system, the maximum increase in production volume is only about 30%," and added, "Since the survival of the entire automobile industry depends on this, political support along with active cooperation from labor unions is urgently needed."

At the same time, there are calls for essential policy support from the political sector. Professor Lee emphasized, "If the situation prolongs, automobile prices will rise, raising concerns about a decline in export competitiveness," and stressed, "To overcome this, strong policies to relax and expand the conditions for special working hours are necessary."