Hyundai, Kia suffer disruptions due to truckers' strike
Kia's Gwangju plant employees drive new vehicles to a storage yard, Wednesday. As it became impossible to mobilize car carrier trucks due to a truckers' strike, the government issued temporary driving permits so that Kia employees could move the newly produced vehicles. Yonhap
By Baek Byung-yeul
Recently built cars are being driven one by one out of automotive factories, due to a lack of transport trucks amid an ongoing strike by cargo truckers, according to industry officials Friday.
The government issued temporary permits enabling the carmakers to do so, in order to shorten delays in deliveries of the new cars to customers.
Hyundai Motor Group units, including its logistics company Hyundai Glovis, are known to have deployed employees to deliver newly produced Hyundai Motor, Kia and Genesis cars to storage yards one at a time, as they are unable to rely on transport trucks that can carry multiple cars at once due to the strike.
On June 7, most of the 25,000 truck drivers from the Cargo Truckers Solidarity and many non-unionized truckers launched the strike, demanding the government extend a freight rate system guaranteeing basic wages for them amid an oil price surge.
The strike has been underway for four days as of Friday, and the Ministry of Land, Infrastructure and Transport said 7,800 drivers were still participating in the walkout, refusing to return to work.
Domestic Korean car brands have already been suffering disruptions over the past three years due to global supply chain problems, and the strike is making their situation much worse.
Officials from the local car industry said the truckers' strike caused delivery delays for newly produced cars, hurting not only carmakers but also customers in Korea and around the world who purchased new cars.
“After carmakers produce new cars at factories, the new cars need to be sent to storage yards. And then the cars are shipped to ports for export or delivered to various places around the country for domestic customers. But the truckers' strike hampered the transportation process, which is causing severe losses to both carmakers and customers,” an official from a local car company said on condition of anonymity.
The official said there have been disruptions to the transportation of not only new cars, but also car components, causing delays to production processes.
“The strike could add to the inconvenience of customers amid a prolonged waiting period for new vehicles to be handed over, due to delays in vehicle production caused by the continued automotive chip shortage and global supply chain issues,” he said.
Another industry official said it looks like there is no way to solve this problem.
“The truckers' strike is what they are targeting the government with, at a time when gas prices are soaring around the world,” the first anonymous official said.
“As not only the car industry but also other industries such as retail have been seriously affected by the strike, we have no choice but to wait for the government to actively address the issue.”
Regarding the truckers' strike, an association comprised of companies in the car industry criticized the move, saying the cargo union is killing the industry with its strike.
“At a time when the car industry has been struggling with a global supply crisis caused by the COVID-19 pandemic and semiconductor supply disruptions, it is extremely selfish for truckers to go on strike and disrupt logistics activities in the industry,” the Korea Automotive Industry Alliance said in a statement released Thursday.