Truckers’ Strike Hits Samsung, POSCO
By Kim Yoo-chul
Staff Reporter
Key manufaturers of home appliances, steel, auto and even construction companies idled production lines or slashed production as container traffic at ports in Incheon and Busan dropping to below 40 percent of normal levels.
The current truckers' strike is much larger than that of 2003, when nearly 5,000 truckers walked off the job for two weeks, costing the nation about $540 million in lost production and delayed delivery.
Their ranks swelled to 10,000 as of early Tuesday, according to the Ministry of Land and Maritime Affairs. The truckers, mainly self-employed workers who bear the burden of fuel costs, are demanding the government increase subsidies to offset ever-soaring fuel prices.
Calls are unexpectedly high that the South Korean government led by self-claimed controversial CEO style Lee Myung-bak should implement decisive measures to settle the disputes. The nation’s economy has already been struggling with skyrocketing oil prices and a global economic downturn.
Samsung Halts Plant
Samsung Electronics Tueday decided to shut down its home appliance plant in Gwangju, as truck drivers there refused to transport cargo.
``The decision will cost us approximately 4 billion won. Inventories are growing,’’ a spokesman told The Korea Times, adding that his company will normalize the production line from Wednesday regardless of the situation.
The nation’s third-largest home appliances maker, Daewoo Electronics, is planning to stop production at some of its lines in Gwangju within the week in an attempt to cut costs.
``We will slash 20 percent of our oven production, with similar measures to be implemented on washers and cleaners depending on the situation,’’ a spokesman there said.
LG Electronics doesn’t have any immediate plans to make changes to production, however, company officials say changes are likely to occur in preparation for what the company claims is the ``worst-case scenario.’’
LG, the world’s 4th largest mobile phone maker, said it was forced to cease product shipments from its factory in Changwon, South Gyeongsang Province, some 400 kilometers south of Seoul.
The nationwide strike is also a political blow to the new government, which has already been embroiled in mounting protests with the public over its agreement to resume U.S. beef imports.
POSCO to Reduce Working Hours
POSCO, the nation’s biggest steel maker, is considering reducing working hours if the walk out continues.
``We may have to reduce working hours and such a possibility is running high,’’ said a POSCO spokesman, adding his company had been stopped shipping 100,000 tons of steel since Saturday.
The nation’s other leading steel makers, Hyundai Steel and Dongguk Steel, located in Pohang, North Gyeongsang Province, an industrial city 380 kilometers southeast of Seoul, are preparing to take similar action.
Meanwhile, petrochemical products have also piled up at the storage facilities of LG Chem, Hyundai Oilbank and Lotte Daesan Petrochemical in the Daesan Petrochemical Complex.
The construction industry, which has been suffering from a worsening profitability due to increasing signs of an economic downturn, is also experiencing difficulty due to a delay of essential supplies.
The Korea Cargo Workers Union, accounts for only 4 percent of all commercial vehicle drivers, however, many drive large container-hauling trucks that are critical to the country’s ability to haul freight by road.
The government has pledged to give 50% compensation for diesel prices above 1,800 won per liter, but the union wants to lower the threshold to 1,600 won.
Despite efforts to break the standoff, the strike is quickly spreading across the country.