Kia workers tentatively OK 2025 wage deal amid tariff concerns

Kia Corp.'s Sohari plant in Gwangmyeong, Gyeonggi Province / Yonhap

Kia Corp. and its union have tentatively agreed on a wage deal for 2025 amid growing concerns over U.S. import tariffs, the company said Thursday.

Kia's 26,000-member union accepted the company's proposals, which include a 100,000 won ($71) increase in basic monthly pay, four and a half months of performance-based bonuses, 15.8 million won in cash, 200,000 won in gift certificates per worker and 53 Kia shares, the company said in a press release.

Under the deal, the maker of the K5 sedan will also hire 500 engineers for its production lines by the end of next year.

Kia and the union also agreed to cooperate in transforming the automaker's domestic plants into core production facilities for next-generation models, such as purpose-built vehicles, the release said.

"Facing unprecedentedly high U.S. tariffs on imported vehicles, the company and the union reached the tentative deal to weather growing uncertainties and strengthen future competitiveness," a Kia official said.

Kia and its union had signed wage deals without strikes for the past four years through 2024.

The tentative agreement will be put to a union vote on Tuesday.

On July 30, Seoul and Washington reached a framework deal under which the United States agreed to lower "reciprocal" tariffs on Korean products and cut auto tariffs to 15 percent from 25 percent in return for Korea's pledge to invest $350 billion in the U.S., along with other commitments. But the auto tariffs have yet to be lowered.

Last week, unionized workers at Hyundai Motor, Kia's larger affiliate, voted to accept the company's wage proposals, including a 100,000 won increase in basic monthly pay for this year.

Under the wage deal, Hyundai workers will receive performance-based bonuses equivalent to four and a half months of salary, 15.8 million won in cash, 30 Hyundai shares and a gift certificate worth 200,000 won per worker.

Hit by steep U.S. tariffs and slowing demand for electric vehicles (EVs), Hyundai's net profit fell 12 percent year-on-year to 6.63 trillion won in the first half, while Kia's dropped 19 percent to 4.66 trillion won.