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Busan factory ends partial shutdown after strike

Jan 24,2020
Renault Samsung Motors said Thursday it ended a two-week partial shutdown of its plant after agreeing to resume wage negotiations with the workers’ union next month.

The move comes after workers on Tuesday suspended partial strikes at the company’s sole plant in Busan, following a series of partial walkouts for higher wages.

“The company and the union will sit at a negotiating table from Feb. 4 to Feb. 7 for a breakthrough in wage talks,” a company spokesman said by phone.

To avoid further losses from the walkouts, the company partially shut down the plant for the overnight shift, beginning Jan. 10. The strikes caused production losses of about 10,400 vehicles worth about 200 billion won ($173 million).

Over the past two weeks, 70 percent of the 1,700-member union chose not to join the partial strikes. This appears to have led to the union stopping its actions this week.

It was the second time for the company to partially shut down the plant after it took a similar step for one day during wage negotiations with the labor union in May 2018.

Early last month, the union voted to stage a strike in protest against the company’s wage freeze proposal for the year 2019.

The company also offered a voluntary retirement program, the first since 2012, to its 1,800 employees in September, but only a few dozen workers applied for the program.

In June last year, the union sealed a wage deal with management for the year 2018 after staging 62 rounds of strikes that resulted in output losses of 14,300 vehicles.

The company has said it will be difficult to maintain the current workforce as the output volume of Nissan Motor’s Rogue SUV is expected to fall sharply this year from last year’s 60,000 units.

Renault Samsung had produced about 100,000 Rogues at the Busan plant, to be exported under a manufacturing contract with Nissan. But Nissan cut its output allocation to the plant to 60,000 last year, citing output losses caused by labor strikes.

To offset the reduction in the Rogue production, Renault Samsung badly needs to secure export volume for the XM3 compact SUV, but the company is still in talks with its parent company Renault, and no decision has been made yet.

For the whole of 2019, Renault Samsung’s sales plunged 34 percent, to 90,591 vehicles from 137,208 one year earlier.

The company’s current lineup includes the SM3 compact, the all-electric SM3 Z.E. sedan, the QM3 small SUV and the SM5, SM6 and SM7 sedans.

Renault SA has an 80 percent stake in Renault Samsung.

Yonhap