Hyundai auto workers prepare to strike as talks collapse

Hyundai Motor's labor union has begun preparations for a strike after negotiations with management fell through.

"We declared negotiations deadlocked on Friday and filed for mediation with the National Labor Relations Commission, an agency under the Ministry of Employment and Labor, on Monday," the union said Tuesday.

The union plans to hold an extraordinary delegates' meeting on June 23 to determine its strike strategy, followed by a strike authorization vote among its roughly 39,000 members on June 25.

If the commission suspends mediation and union members approve the strike, the union will secure the legal right to walk out.

The company’s labor and management held more than 10 rounds of talks between May 6 and Friday, beginning with their first meeting on May 6, but failed to reach an agreement.

A key issue in the negotiations is the union's demand for a fixed monthly salary system. Under the current pay structure for production workers, wages are based on hourly rates, with overtime pay, holiday allowances and performance bonuses making up a significant portion of earnings.

The union, however, is calling for a system that guarantees a fixed salary regardless of hours worked. The demand stems from concerns that workers' incomes could decline as production environments evolve, namely through the use of robots.

The union argues that under the current pay system, reduced working hours resulting from AI-powered robots, increased automation and a growing share of production taking place overseas could lead to lower earnings.

“Matters such as the transfer of vehicle production overseas are directly tied to union members' job security,” the union said in a recent newsletter. "We will make sure to stop the company from moving forward unilaterally."

The union's demand to raise the retirement age from 60 to 65, in line with national pension eligibility, has also emerged as a major sticking point in the negotiations. Hyundai Motor's mandatory retirement age is 60, although workers can remain employed for an additional year under a skilled reemployment program as fixed-term contract employees rather than regular staff.

The planned introduction of Atlas, an AI-powered humanoid robot, has become another significant point of contention. Hyundai Motor plans to gradually deploy Atlas robots on production lines beginning in 2028.

"Not a single robot will be allowed into domestic production sites without an agreement between labor and management," the union said.

The union has also launched a public campaign over the issue. It has installed 255 banners on major bridges and roadside lampposts in Ulsan — where many of the company's key manufacturing facilities are located — bearing slogans warning against the use of robots and AI without consideration of workers' rights.

The union plans to expand promotional activities through city buses, apartment elevators and movie theaters. A union official described the campaign as “an effort to build public understanding of the union's demands.”

The union also put facility investment planning issues on the negotiating table during this year's talks. Hyundai Motor plans to reconstruct aging facilities, namely Ulsan Plant 1. The project would require production to be halted during construction, raising concerns about potential job losses.

The union is demanding guarantees on employment and worker reassignment during any shutdowns related to the reconstruction project. It has also warned that it will oppose the rebuilding plans if its demands are not accepted.

"During this year's negotiations, we raised urgent workplace demands, including wage increases, performance-based compensation and job security, in an effort to secure workers' fair share," the union said in a statement following its declaration that negotiations had broken down.

"However, the company sidestepped those demands, repeatedly citing that conditions were difficult despite posting record-level results.”

The company responded by saying it would continue to negotiate in good faith to reach a mutually acceptable agreement.

BY KIM YOUN-HO [[email protected]]