[Reporter’s Notebook] Ready-Mix Concrete Conflict, The Solution Lies in Consideration and Communication

[Asia Economy Reporter Kim Daeseop] Ready-mix concrete manufacturers located in the Seoul metropolitan area are struggling with demands for increased transportation fees. On the 29th, they held an emergency press conference at the Korea Federation of Small and Medium Business in Yeouido, Seoul, to express their difficulties.

Due to the construction industry downturn and the COVID-19 pandemic, ready-mix concrete shipments have decreased by more than 19% compared to the previous year, causing significant operational challenges. However, ready-mix concrete transport operators are demanding a 15% increase in transportation fees and planning collective action without considering this situation, which has been strongly criticized.

According to metropolitan area ready-mix concrete companies, if the 15% increase in transportation fees demanded by ready-mix concrete transport operators is not accepted by the 30th, a collective refusal to transport ready-mix concrete is expected to occur starting July 1. This emergency press conference appears to have been prompted by a sense of crisis following recent collective actions and transportation fee increases by ready-mix concrete transport operators in some regions.

Last month, in the Busan and Gyeongnam regions, the Busan Construction Machinery Branch of the National Construction Workers' Union under the Korean Confederation of Trade Unions and the Busan-Gyeongnam Ready-mix Concrete Industry Development Council agreed to increase ready-mix concrete transportation rates by 20%. Previously, the union had conducted a general strike demanding an increase in ready-mix concrete transportation fees. The National Ready-mix Concrete Transport Federation, a union-type organization of mixer truck drivers affiliated with the Federation of Korean Trade Unions, also demanded transportation fee increases and held a general strike in the Gwangju and Jeonnam regions.

The demand for increased ready-mix concrete transportation fees seems to be spreading nationwide. According to the industry, ready-mix concrete transport operators are individual business owners who directly contract transportation with ready-mix concrete manufacturers. Ready-mix concrete companies are requesting that transport operators refrain from excessive fee demands and collective actions.

If the delivery of ready-mix concrete to construction sites is halted, there are no alternative means to transport ready-mix concrete other than mixer trucks. Ready-mix concrete manufacturers, construction companies, and transport operators would inevitably suffer damages, according to the ready-mix concrete companies.

Due to the construction industry downturn, both ready-mix concrete companies and transport operators are facing many difficulties. On top of this, the COVID-19 pandemic has had a negative impact. In this situation, conflicts between ready-mix concrete companies and transport operators negatively affect the industry and economy. The conflict over minimum wage increases is also an issue. The Korean Confederation of Trade Unions is demanding a 25.4% increase in the minimum wage for next year compared to this year. It is a time when consideration and communication for mutual cooperation are necessary.