Hyundai Workers Elect Leader Behind One of Union’s Worst Strikes

  • Union has struck against Hyundai in 25 of the past 29 years
  • Carmaker has posted seven straight quarters of profit declines

Hyundai Motor Co. workers re-elected a labor leader who was in power almost a decade ago during one of the worst years of industrial strife at South Korea’s largest automaker, setting the stage for final wage talks next month.

Park You Ki, 50, beat former deputy head Hong Sung Bong to become union president, according to the labor group. In his previous term leading the union in 2006 and 2007, Hyundai suffered its second-biggest annual production loss of 118,293 units from work stoppages, costing the carmaker 1.64 trillion won ($1.4 billion). Park takes over from Lee Kyung Hoon, who limited lost output to fewer than 17,000 vehicles a year.

Hyundai, which has suffered strikes in 25 of the 29 years since the union’s formation, can ill afford production disruptions as it seeks to end a streak of seven consecutive declines in quarterly profit. Over the years, the automaker has lost cumulative production of about 1.4 million vehicles valued at more than 16 trillion won due to strikes, according to company estimates.

“The biggest task for the next union leader will be wrapping up this year’s annual wage negotiations as quickly and as painlessly as possible,” Lee Sang Hyun, an analyst at IBK Securities Co., said before the union released election results. “Park winning the vote is a concern for Hyundai as an increase in strikes that lead to big production losses is something the company needs to avoid at the moment.”

Past protests at Hyundai have led to clashes between riot police and workers armed with steel pipes and Molotov cocktails.

Park, who joined the automaker in 1988, has been arrested at least twice for actions including staging protests, according to his profile posted on the union’s website. He works in the company’s quality control division and served as the president of the umbrella labor group Korean Metal Workers’ Union from 2009 through 2011.

Global deliveries for Hyundai declined 1.5 percent in the year’s first 10 months as demand waned in China, Russia and Brazil. Profit dropped 23 percent for the quarter that ended in September.

Hyundai seeks to complete the wage negotiations at the earliest opportunity and maintain a cooperative relationship, the Seoul-based automaker said in an e-mailed response before the ballot. The union declined to make its candidates available to comment for this story.

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