Hyundai Motor Company’s earnings increase without labor disputes

Yugyeong Jeong

http://www.hyundai.com

In September of last year, the basic wage was frozen in 11 years and a dispute-free agreement was reached for two years in a row without a strike, resulting in changes in the labor-management relations of Hyundai Motors. Following the currency crisis in 1998 and the global financial crisis in 2008, they joined forces to overcome the COVID-19 crisis last year. However, the process was not easy. The union leadership agreed to freeze wages excluding the increase in salary, but there were voices of opposition from within. The leadership persuaded the members, saying that if a general strike was held solely for the interests of the members, the social isolation of the union would be fixed, and the result was voted in favor.

After the wage bargaining was concluded, Hyundai Motor Group Chairman Chung Eui-sun asked to find a way to stabilize labor-management relations, satisfy employees, and match the company’s development. With the union of labor and management, Hyundai Motor Company and Kia’s performance achieved an earnings surprise. Sales, operating profit, and net profit surged in the first quarter of this year, and profitability improved as sales of high-value vehicles and new cars were booming. However, it is difficult to ascertain whether a dispute-free agreement will continue this year due to various variables such as the MZ generation-oriented office/research union and the supply shortage of semiconductors for vehicles.

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