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Hyundai suspends Sonata, Grandeur plant after employee death

Hyundai suspends Sonata, Grandeur plant after employee death
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First Published: Thu, Jun 09 2011. 02 40 PM IST
Updated: Thu, Jun 09 2011. 02 40 PM IST
Seoul: South Korea’s Hyundai Motor Co said on Thursday that it has suspended a plant in the city of Asan producing its best-selling Sonata mid-sized and Grandeur large sedans, after police said an employee there apparently committed suicide.
The incident comes only days after Hyundai started annual wage talks and collective bargaining with employees on Wednesday, and may signal a tough summer for the automaker striving to avoid annual industrial disputes for a third consecutive year.
Hyundai registered a strike-free 2009 and 2010, breaking almost two decades of strife, thanks to new union leadership and a less militant labour movement.
This year’s negotiations also come as Hyundai, the world’s No.5 automaker including subsidiary Kia Motors Corp , aims to boost output to catch up with Japanese rivals and after a strike at a supplier last month disrupted production of sport utility vehicles.
Media reports on Thursday said the union member killed himself after Hyundai stopped paying wages to full-time unionists from April under a new labour regime introduced last year.
Under the new labour law, which President Lee Myung-bak’s pro-business government implemented in July last year, Hyundai and its union have been locking horns over cutting the number of full-time paid union organisers.
Hyundai is demanding the union cut the number of full-time unionists to 24, one-tenth of the current 235, a call flatly rejected by the union.
A police officer said the dead unionist left two suicide notes, and that Hyundai employees were preventing them from collecting the body and demanding talks with Hyundai management.
The Asan plant, the sole Korean facility producing Sonata and Grandeur sedans, has an annual production capacity of 300,000 cars.
The Grandeur was Hyundai’s best-selling model in South Korea last month and sales more than quadrupled to 10,526 units from a year earlier, lifting Hyundai’s overall sales by 13.6%.
Prior to the news, Hyundai shares closed down 2.16% versus a 0.57% drop in the benchmark index .
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First Published: Thu, Jun 09 2011. 02 40 PM IST
More Topics: Hyundai | Plant | Automaker | Sonata | Grandeur |