Hyundai Motor’s unionized workers in South Korea voted to strike over stalled wage talks, adding to the woes of the company that is bracing for possible new U.S. tariffs amid falling profits.
Its shares slid to eight-year lows following the union, which has voted to strike annually for the last six years, stated on Monday that nearly three-fourths of its 44,782 voters voted in support of the strike action.
“We have not been able to narrow differences in major issues, making it difficult to reach a preliminary (wage) deal easily,” the union stated.
Union negotiators later on Tuesday decided to hold off on starting the strike until July 10, when they will talk about a strike plan again, a union spokesman stated.
The union walked out of the wage negotiations in late June, following Hyundai Motor’s proposal of wage increases and bonuses which the union said fell short of expectations.
This year, the union is asking for a 5.3 percent boost in basic monthly wage, below the 7 percent it asked for last year and compared to South Korea’s yearly inflation rate of 1.9 percent for last year. It also wants performance pay amounting 30 percent of the automaker’s last year net profit.
The demands come at a time when South Korea’s automobile industry is going through rough weather. The country’s vehicle production dropped 3 percent 41.15 million in last year, its lowest level since the 2009 global economic downturn.