GM plans no pullout from S. Korea but workforce a worry -CEO quoted

Business & Markets 2013
Written by Reuters
Tuesday, 07 May 2013 13:13
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SEOUL (May 7): General Motors Co will not pull out of South Korea but
will discuss labour woes with South Korea's President, its CEO was
quoted as saying by its Korean union, a move that could complicate
already troubled relations with its local workforce.
Chief Executive Dan Akerson said last month GM might look at shifting
output from this key production base in the long-term due to tensions
between South and North Korea, angering the union. This latest
development suggests annual wage talks will not be easy when they
start later this month.
Akerson plans to bring up concerns about labour in talks with South
Korean's President Park Geun-hye during her U.S. trip this week. He
made his remarks at a meeting with GM Korea's union leader last week
in Detroit, union spokesman Choi Jong-hak said.
"We are upset by his remarks. We did not go all the way to the U.S. to hear that," Choi said.
A Shanghai-based spokeswoman for GM's international operations declined to comment, saying the automaker considers
meetings between GM senior leaders and union officials to be private.
South Korea is one of GM's biggest overseas manufacturing bases, producing more than four out of 10 Chevrolet vehicles
sold globally, but the industry is prone to disagreements with what it says are uncooperative unions.
Speculation about a possible shift of some production to bolster ailing European manufacturing centres has continued despite
GM saying in February that it would invest $7.3 billion in its South Korean unit over the next five years.
A wage lawsuit filed by GM Korea's labour union members could lead to an increase in labour costs, which have already
grown too fast over the past decade, executives have said.
Hyundai Motor Co, South Korea's biggest automaker has its own labour woes, with workers having refused to work
weekends since March, hurting sales and earnings in the latest quarter.
Choi said Akerson's previous comments on a potential shift of production was an empty threat to tame the union ahead of
talks on a possible restructuring of production systems.
"GM cannot withdraw from South Korea. We have TECHNOLOGY [] to make good cars and our wages are only about one
third of those in the United States and Europe," he said.