Why is Hyundai Motor Ulsan Plant Line 42 Popular?

Overtime Schedules Vary by Line... Popular Model Porter Faces Concentrated Overtime

[Asia Economy Reporter Su-yeon Woo] Hyundai Motor Company has adjusted its weekend overtime work to control production volume. This is to flexibly respond to the semiconductor parts supply instability and market demand slowdown that have continued since the year before last. Because of this, recently, Hyundai Motor production workers have been envying those working on certain lines. Overtime work is concentrated mainly on popular car models.

According to a compilation of reports from this paper on the 7th, the only production line that has continued weekend overtime work without a break except during the Lunar New Year holiday this year is Line 42. Line 42 corresponds to Line 2 of Ulsan Plant 4 and produces the 1-ton truck Porter. Hyundai Motor production workers' salaries differ by tens of thousands of won per month, and up to millions of won per year, depending on whether they work overtime.

Even when most Hyundai Motor and Kia production lines stopped operating in 2021 due to semiconductor supply shortages, Line 42 operated until the latest time. The Porter, a 'recession-type model,' is considered the people's vehicle. It is mainly purchased by small-scale self-employed people for their livelihood. The Porter is widely used for livelihood-related transportation such as moving cargo, parcel delivery, and food material transport.

Last year, more than 90,000 Porters were sold domestically. It ranked first in domestic sales for two consecutive years. Since the year before last, Hyundai Motor has suffered large-scale production disruptions due to semiconductor supply shortages. High-end passenger models are equipped with more electronic devices than commercial vehicles. Accordingly, they require more automotive semiconductors. The Porter, a commercial vehicle with relatively fewer electronic devices, was less affected by the semiconductor supply shortage.

The increase in parcel logistics volume due to COVID-19 also had a significant impact. The Porter is widely used as a parcel delivery vehicle. Recently, logistics companies have been increasing the introduction of electric parcel delivery vehicles. As demand for eco-friendly vehicle replacement in the logistics industry has increased, Porter EV sales surged. Last year, 20,418 Porter EVs were sold domestically, a 29% increase compared to the previous year. The proportion of electric vehicles in total annual Porter sales rose from 9.5% in 2020 to 22.1% last year. Currently, if you order a Porter EV, you have to wait at least over a year.

Due to delays in new car deliveries, the number of people seeking used Porters has also increased. According to data from Encar.com, the number of newly registered used Porter2 vehicles increased by 14% compared to the previous year. In particular, prices of the extra-long wheelbase model with a large cargo space rose significantly. The used car price of the 2019 Porter2 Super Cab CRDI (extra-long wheelbase) model increased by 15%, from 12.65 million won in the first quarter of last year to 14.59 million won in the fourth quarter.

Hyundai Motor operates Line 42 as much as possible on weekends to respond to the surging Porter demand. This contrasts with other production lines that have stopped or slowed down due to a shortage of semiconductor sensors. Kia Gwangmyeong Plant 1 will close for five days starting from the 9th of this month due to a shortage of 'side impact sensor' parts.

The side impact sensor is a part that activates the airbag in the event of a vehicle collision. The finished product is produced by a Chinese company, but the semiconductor installed is made by the Dutch semiconductor company NXP at its Malaysian plant. It is reported that there was a malfunction in the equipment that draws semiconductor circuits on wafers at NXP's Malaysian plant. Models affected include Hyundai Motor's Ioniq 5, GV80, GV60, G80, G70 (Genesis), Carnival, Sorento, and Kia's EV6.