By Kim Tae-jong
Renault Samsung Motors (RSM) is experiencing another setback due to its union’s partial strikes amid its prolonged sales slump for years.
The automaker’s union staged a partial strike, Monday , following ones on June 3 and 5.
The workers on the daytime shift stopped working for two hours from 1:45 p.m. while those on the nightshift went on strike for four hours from 7:45 p.m.
The move came after 94 percent of union members voted for the strike to demand an increase in base salary and improve welfare benefits.
Despite a series of meetings between management and labor, they have failed to narrow their differences on the salary issue.
Management said it can’t afford to increase the base salary, citing the very heavy financial burden that is required to do that, amid the prolonged slump in sales.
“We have accepted most demands from the union except for the increase in base salary,” an RSM official said. “We can’t afford the increase as we experienced drops in sales and production of vehicles last year. It is even hard to maintain the two-shift system due to low demand.”
The automaker has suffered prolonged sluggish sales at home and abroad in recent years, which led it to restructure its workforce through a voluntary retirement program. Some 800 employees have left the company as a result.
According to the company, it only sold 154,309 cars last year — a 45.1 percent drop in the domestic market and a 31.4 percent decline overseas, compared to the previous year.
Due to the declining sales, RSM also suspended operations at its Busan plant several times last year.
The situation has shown little signs of improvement this year with sales dropping by 29 percent and production by 16 percent in the January-May period, compared to the same time last year.
But the official downplayed the possibility of a full strike, saying they have been narrowing their differences with union leaders, although some union members are unyielding.
The union argued that the management only emphasized the decline in sales and production without mentioning increased profitability in order to keep the base salary at the current level.
“Due to the localization of most auto parts, decreased technology transfer fees and higher productivity, profitability is getting better,” an official from the union said, arguing there is room for a salary hike.
An association of 11 regional civic groups in Busan also demanded that the company should make an effort to normalize its operation to improve the local economy.
They also criticized Renault Group for taking massive profits away from its Korean operation, which has worsened its business here.
“We demand Renault Group stop taking profits away from RSM and make a substantial investment in its local unit,” they said Wednesday in a statement after a news conference.
They also urged the group to make more efforts to localize auto parts and stop restructuring the workforce at RSM.
To deliver the message, they plan to hold a discussion session at the Busan City Council on June 24, with plans to include the participation of officials from its senior management.