Kia Motors, Unionized Workers Resume Talks to End Wage Dispute

SEOUL, July 5 Asia Pulse - Kia Motors Corp.'s (KSE:000270) management and labor union resumed talks on Thursday to try to end a dispute over wage hikes demanded by the company's 28,000 workers after failing to narrow differences a day earlier, both sides said.

However, an accord on wages remains elusive as Kia executives haven't presented a counter offer to the union's demand of an 8.9 percent raise in basic salary and a special bonus equivalent to two months' salary. If no agreement is made on Thursday, the union said it would strike on Friday.

"The management is still undecided on the counteroffer because both sides are far apart," Kang Hyun-geun, the Kia spokesman, said of the talks at the main plant in Gwangmyeong, just south of Seoul.

"There seems to be nothing more the management can do now and there should be more negotiations to narrow the gap," Kang said.

Union officials have warned they would decide on future strike actions, besides Friday's planned partial strike, if management fails to present "satisfying concessions" by Thursday.

Kang said no end time has been set for Thursday's talks.

Kia workers had originally planned to strike from Tuesday through Friday, but they decided to work on Wednesday and Thursday, citing the two-day dialogue.

Tuesday's eight-hour partial strike cost Kia 28 billion won (US$30 million), or 1,900 vehicles in lost production, according to the company.

For the first quarter of this year, Kia posted a net loss of 30.6 billion won (US$33 million), marking its third consecutive quarterly loss.

The union of Kia, an affiliate of Hyundai Motor Co. (KSE:005380), has gone on strike every year for the past 17 years.

Separately, Hyundai's 44,000-strong union will start annual wage negotiations with management on July 12, said the union spokesman Chang Kyu-ho said.

Last year, Hyundai workers staged strikes for nearly one month over higher wages and better working conditions, costing the company 1.64 trillion won in lost production.

Strikes are an annual ritual for Hyundai and Kia. Many analysts cited labor unrest, along with Hyundai Motor Chairman Chung Mong-koo's ongoing embezzlement trial, as a key obstacle to the South Korean automobile conglomerate's target to become one of the world's top five automakers by 2010.

Earlier in the day, the Seoul High Court postponed until July 10 sentencing for Chung, saying that it needs more time to review the case.

In February, the 69-year-old tycoon was convicted and sentenced to three years in jail for embezzling some US$100 million in company funds and bribing government officials to get business favors.

On June 19, prosecutors requesed the appeals court to hand down a six-year jail term for Chung, claiming that three years in prison would be too light a sentence for him.

(Yonhap)

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