Renault headquarters issues a warning to reduce production quantity in Korea
Renault headquarters issues a warning to reduce production quantity in Korea
  • Lee Jun-sung
  • 승인 2019.02.11 10:59
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Since the second half of last year, labor and management of Renault Samsung Motors have been at odds over a basic salary increase. While the negotiations are not going well, its headquarters in France has even sent a warning message that it may not assign production quantity to Korea.

Jose-Vicente de Los Mozos Obispo, vice chairman of Renault Group sent a video message to Renault Samsung’s executives and employees, saying, “If the strike continues, the operating hours of the plant will go down and the trust you have built up will fall. Under these circumstances, it is hard for us to have a discussion with Renault Samsung on the follow-up production quantity.

“If you compare the Busan factory with the Kyushu factory in Japan, the Busan factory is 20 percent more expensive in terms of costs. If the strike continues, it is not possible to proceed with subsequent production volume negotiations.”

Currently, Renault Samsung has produced SUVs of Nissan, Japan, on consignment basis and the deal will end in September.

At the heart of the labor-management conflict is whether to raise the basic salary. The management is concerned that raising the basic salary will increase production costs so much that it will not be able to receive more production volume from the head office.

The labor union, however, argues that a basic raise is necessary since operating profit in 2017 exceeded 400 billion won.

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