HiteJinro Starts Shipping Operations at Gangwon Factory
About 200 Employees Deployed On-site... No Friction During Entry
HiteJinro "Monitoring Exit Situation"
Conflict Enters Fifth Month... Concerns Over 'Beer Shortage'
On the morning of the 8th, a logistics vehicle is loading beer products at the Hite Jinro Gangwon Factory. Photo by Hite Jinro
[Asia Economy Reporter Song Seung-yoon] HiteJinro, which is experiencing disruptions in beer shipments during the summer peak season due to protests by the Cargo Solidarity under the Korean Public Service and Transport Workers' Union affiliated with the Korean Confederation of Trade Unions, has deployed a large number of headquarters employees to its Gangwon factory to begin beer product shipment operations. This is the first time since the conflict between HiteJinro and the Cargo Solidarity that employees have been directly involved in shipments.
According to HiteJinro on the 8th, from 8 a.m. that day, about 200 headquarters employees were deployed to the Gangwon factory in Hongcheon-gun, Gangwon Province, to carry out product shipment work. Police officers from the Gangwon Provincial Police Agency and Hongcheon Police Station were also stationed at the site. It is reported that about 50 members of the Cargo Solidarity remained at the site.
As of 9 a.m., the company secured the factory entrance and exit routes, and about 30 vehicles entered the factory to load beer products. The personnel deployed on site are expected to manage vehicle control and shipment operations. Since the entrance and exit routes were secured without issues, there were no conflicts during vehicle entry, and the personnel are currently on standby. Although no physical clashes with the union have occurred yet, protests continue at the site, and since the exit operations have not started, tension remains high. Considering the possibility of clashes, the exit operations will be conducted all at once. HiteJinro plans to ship the usual volume of 120,000 boxes as scheduled for the day.
A HiteJinro official said, "Thanks to the help of the police and employees, there were no significant conflicts until vehicle entry, but we need to monitor the exit situation a bit more," adding, "Since a large number of personnel have been deployed, we plan to raise the shipment rate to the usual level as much as possible."
Since the 2nd, shipment disruptions have occurred at HiteJinro’s Gangwon factory due to protests by the Cargo Solidarity. The Cargo Solidarity occupied and staged sit-ins at the factory entrance using trucks and other vehicles. The Gangwon factory, which produces beer products such as Terra, Hite, Max, and Filite, accounts for the largest production share among HiteJinro’s beer factories. However, since then, shipments have either not been made at all or have been significantly below normal levels, with the shipment rate at about 25% of usual. On the first two days of the protest, the 2nd and 3rd, no products were shipped, and on the 4th (76%) and 5th (25%), shipment rates were significantly lower than usual. No products were shipped on the weekend of the 6th and 7th either.
The conflict between HiteJinro and the Cargo Solidarity has continued for five months. About 130 truck owners affiliated with Suyang Logistics, a subcontracted freight carrier for HiteJinro, joined the Cargo Solidarity under the Korean Confederation of Trade Unions at the end of March and began striking. Starting with a partial strike in March, they escalated to a full strike in June, and since the Cargo Solidarity’s general strike, they have continued obstructive actions such as illegally parking trucks near the factory entrances of the Icheon and Cheongju factories or occupying the entrance and exit routes. They are demanding increases in transportation fees and empty container shipping fees, as well as payments for vehicle advertising costs, idling, and waiting times.
HiteJinro has been responding by filing civil and criminal lawsuits against those involved in illegal activities and actively requesting crackdowns from local governments and the police, but the truck owners’ resistance has intensified. On the 22nd of last month, 29 union members were arrested on the spot for illegal acts during a rally at the Cheongju factory, and at the Gangwon factory on the 4th and 5th, union members who blocked logistics vehicle movement and refused dispersal orders were also arrested on the spot. The police have requested arrest warrants for four of them. This is the first case under the Yoon Seok-yeol administration where the police used physical force to forcibly disperse illegal protests.
HiteJinro estimates that direct losses calculated since the full transportation refusal began in June amount to about 5 to 6 billion KRW. Considering production and sales losses and other related factors, the total damage is estimated to be in the range of 10 to 20 billion KRW.
Within the alcoholic beverage industry, concerns continue to grow that ongoing labor disputes could disrupt the supply of alcoholic products during the peak summer season. OB Beer, the industry leader, is also facing ongoing labor conflicts, raising fears that the situation could escalate into a widespread "beer crisis."
An industry insider said, "The longer the strike continues, the more losses companies inevitably accumulate in various areas," adding, "Since the protests are continuing targeting the summer beer peak season, the government should actively deploy public authority to crack down on illegal activities."
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