Key Points
Wage talks stalled between Hyundai Steel and labor union
Production halt impacts 270,000 tonnes of steel
Union demands 159,800 won pay increase
Company proposes lower wage hike
Hyundai Steel stopped operating its pickling line/tandem cold mill (PL/TCM) facility, a key part of the steel plant of its Dangjin integrated steel mill, about 80 kms southwest of Seoul, the company said in a press release.
The suspension of the PL/TCM facility, which removes oil and rust from hot-rolled coil before processing it into cold-rolled steel products, has brought the cold-rolled steel plant to an immediate halt, reports Yonhap news agency.
"The plant will remain halted until unionized workers (at the cold-rolled steel plant in Dangjin) decide not to hold a strike simply to make their demands heard in wage talks," a company spokesperson said.
The company expects the plant's suspension will result in production losses of at least 270,000 tonnes, valued at 25.4 billion won ($17 million).
The "defensive measure" against the walkout comes amid wage talks with the labour union that have stalled since late January.
The union demanded a 159,800 won increase in basic pay, five months of salary in performance-based pay and 18 million won in a cash bonus for the year of 2024.
The company balked at the request, instead proposing a 100,000 won pay increase, along with 4 1/2 months of salary and 10 million won in bonuses.
The company-proposed wage hike alone would lead to a 98 percent on-year decline in its annual net profit from about 443 billion won in 2023 to 8.81 billion won in 2024, according to the company.
On Monday, Hyundai Steel fell 2.08 per cent to 25,900 won, far underperforming the 0.35 per cent loss by the broader Korea Composite Stock Price Index (KOSPI).
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