General Motors will hold talks with South Korean president Park Geun-hye to discuss labor issues in the country, GM chief executive Dan Akerson was quoted by its Korean union as saying. Such a move, however, is expected to further complicate troubled relations between GM and its Korean workers.
Akerson said in April that GM might consider shifting production from South Korea in the long term due to the conflict between country and its North Korea sibling. His remark was met with opposition from GM’s Korean union. South Korea is one of the carmaker’s largest overseas manufacturing hubs, building more than four out of 10 Chevrolet vehicles sold globally.
In fact, GM builds most of the Chevrolets it sells in Europe in South Korea. However, the auto manufacturing industry in the country is prone to disagreements with what it labeled as uncooperative unions. Rumors about transferring some Chevrolet production from South Korea to Europe to support its beleaguered plants in the region have persisted despite GM’s statement in February that it would invest $7.3 billion in its South Korean unit over the next five years.
GM’s latest move may mean that annual wage talks will not be simple when they commence this month. Akerson plans to discuss labor issues with President Park during her trip in the United States this week.
Union spokesman Choi Jong-hak said that Akerson revealed this development during a meeting with GM Korea's union leader last week in Detroit. A wage lawsuit filed by GM Korea's labor union members could result to increased labor costs, which have already spiked too fast over the past decade, GM executives have remarked.