Hyundai Transys Strike Enters 15th Day... Hyundai Motor and Kia Overtime Work Halted

Hyundai Transys Strike Continues After 8th
Parts Shortage for Finished Vehicles on 15th Day of Strike
Hyundai Motor Cancels Overtime on Kona Production Line This Week
Hyundai Motor and Kia Begin Partial Production Line Gap Shift Operations

As Hyundai Motor's Indian subsidiary attracts attention by listing on the local stock market, disruptions in the production of Hyundai Motor and Kia vehicles are becoming a reality in South Korea. Hyundai Transys, which supplies transmissions, has been on strike for two weeks, leading Hyundai Motor and Kia to cancel some weekend overtime shifts and begin slowing down production lines.

According to industry sources on the 23rd, Hyundai Motor announced the cancellation of the weekend overtime shift scheduled for Saturday the 26th on Line 1 of Ulsan Plant 1. Additionally, starting that day, they will operate a "gongpichi" by running empty conveyor belts to slow down production speed. Although concerns about disruptions in vehicle production due to the parts suppliers' strike have been ongoing, this is the first time concrete measures such as canceling overtime and operating gongpichi have been implemented. Line 1 of Hyundai Motor's Plant 1 produces the compact sport utility vehicle (SUV) Kona. Kia has also started operating gongpichi on some production lines at its Gwangju plant.

Hyundai Motor Factory Line
Photo by Hyundai Motor

Industry insiders believe that Hyundai Motor and Kia have been running their vehicle production lines using parts inventory for the past two weeks, but with inventory depletion, further production is no longer feasible. If the strike continues, production disruptions are expected to spread from Hyundai Motor's Kona production line, which is already short on supply, to major models such as the Porter, Genesis, and Kia's Soul and Seltos.

Hyundai Transys is a parts affiliate that supplies key components of powertrains for internal combustion engines, hybrid transmissions, and electric vehicle reduction gears. Last year, it supplied powertrain parts for 4 million vehicles to automakers. As the strike prolongs, Yeosu-dong, President of Hyundai Transys, recently issued a message urging employees to end the strike. President Ye emphasized, "Our future depends on our relationship with our customers," and stated, "A strike that holds the production lines of our automaker customers hostage cannot be tolerated under any circumstances."

The Hyundai Transys labor union demanded a performance bonus equivalent to 2% of annual sales in this year's wage and collective bargaining negotiations. This amount corresponds to approximately 230 billion KRW, double last year's operating profit. The union also requested welfare benefits including housing purchase loans of up to 100 million KRW at an annual interest rate of 1% for up to 15 years. The union plans to decide on additional strikes and the resumption of negotiations through the dispute countermeasure committee.