Will Kaher Kazem's Term Be Extended... Eyes on GM Headquarters

Kaher Kazem, President of GM Korea, is taking his temperature at the 'Automotive Industry Meeting for COVID-19 Response' held last April at the Automobile Hall in Seocho-dong, Seoul. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Kiho Sung] As 28 Korean GM officials, including CEO Kaher Kazem, were indicted without detention on charges such as illegal dispatch, attention is focusing on Kazem's term of office. Kazem's term is set to expire this September. While the industry leans toward the possibility of an extension, groups like the Korean GM Irregular Workers' Union argue that Kazem should be prevented from leaving the country, suggesting that conflicts are likely to intensify.

According to industry sources on the 25th, the prosecution recently indicted five Korean GM executives, including CEO Kazem, and 23 subcontractor operators without detention on charges of violating the Act on the Protection of Dispatched Workers. The charges relate to illegally dispatching 1,719 workers at the Bupyeong and Changwon plants from September 2017 to December last year.

This is the first time a sitting CEO of Korean GM has been indicted. Previously, former CEO Nick Reilly was fined for illegal dispatch, but his indictment and trial occurred after his term as Korean GM CEO ended and while he was an executive at global GM.

Kazem, who took office as Korean GM CEO in September 2017, is approaching the end of his term this September. Korean GM has distanced itself from the issue of extending Kazem's term, stating that "it is a decision for GM headquarters." However, the industry expects Kazem to remain in his position. An industry insider said, "Korean GM recorded a net loss of 320.2 billion won last year, improving the deficit by about 63% compared to the previous year (859.3 billion won). Since it has responded most effectively to COVID-19 among global GM units, the likelihood of extension is high." Currently, Kazem is staying in Korea and is expected to take Korean GM's summer vacation during the first week of August.

Kazem's term is under scrutiny due to precedents. During the 2017 Dieselgate scandal, Audi Volkswagen Korea and key executives including Johannes Thamer were indicted for violating the Clean Air Conservation Act. However, former CEO Thamer left for Germany citing business trips before the trial began and has not returned. Similarly, former Mercedes-Benz Korea CEO Dimitris Silarakis was reported to the prosecution by the Ministry of Environment for manipulating emission programs and left on an overseas business trip, not returning, and is scheduled to assume the CEO position of the Canadian branch on September 1.

The Korean GM Irregular Workers' Union is demanding Kazem's detention and a travel ban. A union official stated, "Our stance demanding Kazem's detention remains unchanged." The Progressive Party's Gyeongnam Provincial Party also issued a statement calling for Kazem's detention.

Korean GM maintains that the indictment is unjust. A Korean GM official said, "We received confirmation from the Ministry of Labor in 2013 that we were complying with the dispatch law. Nothing has changed since then, so it is difficult to understand the recent judgment of illegality. We have operated within the legal framework," they rebutted.