Park Jae-hyuk is a seasoned journalist who has provided comprehensive coverage of South Korea's corporate dynamics, economic policies, industry challenges and the global positioning of Korean companies. Based on the articles he has written since joining The Korea Times in 2016, his investigative approach has helped readers understand corporate governance, economic trends and business strategies shaping South Korea’s economy.
Steel shortage looms as Hyundai unions threaten to strike amid POSCO plant cleanup
Hyundai Steel's unionized workers chant during a press conference at the company's steel mill in Dangjin, South Chungcheong Province, Monday. Courtesy of Korean Metal Workers' Union
By Park Jae-hyuk
By Park Jae-hyuk
Carmakers, shipbuilders and construction firms are feared to face setbacks in securing steel products, as unionized workers at Hyundai Steel are poised to strike in the midst of POSCO's ongoing efforts to restore its Pohang steel mill in North Gyeongsang Province following flood damage, according to industry officials, Wednesday.
Earlier this week, Hyundai Steel's four unions, which are all affiliated with the Korean Metal Workers' Union, warned that they would strike unless management agrees to hold wage negotiations on Thursday.
“Hyundai Steel's Pohang factory was unable to avoid damage from the typhoon, so the labor and management have made efforts to normalize the factory,” they said in a statement, Monday. “Hyundai Steel's main rival, POSCO, was also hit by the typhoon, so our production capacity has become more important for the national economy. However, the company has refused to participate in a wage negotiation, prompting the unions to strike.”
The unionized workers have asked Hyundai Steel since May to raise their monthly base salary by 165,200 won ($118) and give them bonuses equivalent to 15 percent of the company's operating profit last year. They have also occupied CEO An Tong-il's office at the Dangjin factory in South Chungcheong Province over the past five months, as the company refused to pay them a 4 million won bonus, which was given to employees of Hyundai Motor Group's other affiliates ― Hyundai Motor, Kia and Hyundai Mobis.
The management, however, has maintained the stance that it is unable to talk with the four unions all at once, because each of its factories uses a different wage system.
“We are only able to negotiate with each union separately,” a Hyundai Steel spokesman said.
Unionized subcontracted workers of Hyundai Steel chant in front of Hyundai Motor Group's headquarters in Seoul, Wednesday, calling for the steelmaker to hire them directly. Newsis
Apart from the conflict with its regular workers, Hyundai Steel is also in dispute with its subcontracted workers, who plan to go on a 24-hour strike next Wednesday to pressure the steelmaker to hire them directly.
Industry officials expect the intensifying tension between Hyundai Steel's labor and management to worsen the shortage of steel products, causing their prices to rise, given that it is still uncertain whether POSCO will be able to finish its recovery work before the end of this year.
“Domestic steel prices are expected to rise, as buyers will try to secure steel products preemptively for stable supply,” eBest Investment & Securities analyst Ahn Hoe-soo said.
Amid the growing concerns, POSCO said Wednesday that it has gone all out to stabilize the supply of steel products in the domestic market, with the aim of normalizing the Pohang steel mill's operation by the end of this year.
“Our Gwangyang steel mill in South Jeolla Province can produce a sufficient amount of ordinary steel plates for shipbuilding, and we are considering supplying thinner steel plates through the Gwangyang steel mill and PT. Krakatau POSCO in Indonesia,” POSCO said in a press release. “Most steel plates for carmakers have been produced at the Gwangyang steel mill, so there will be limited impact on our customers.”