South Korean labor unions are reacting to news that General Motors plans to shift production of the next generation of the Aveo sub-compact away from the country. The workers threatened the Detroit carmaker with strike action, according to a report from Reuters.
GM Korea boss Sergio Rocha told the union GM had decided to build the new Aveo in China and the United States, with South Korea to produce the model two years after its launch, the union said in a statement. Obviously, that did not go down well with the workers’ representatives.
“It was a shocking announcement,” the union said, adding that it may strike if a deal on wages and future production plans is not reached this month. “Should there is no change in the company’s stance, the labor union will be able to launch strike action – our biggest legal weapon,” the union threatened.
GM’s decision comes during wage talks with its South Korean local workforce and fuels fears that the automaker will gradually reduce its presence in the country. That would not be good for South Korea, which currently makes over four out of 10 Chevrolet vehicles sold globally. GM executives are blaming rising wages and tough labor relations for their decision to produce less cars in South Korea.
A GM Korea spokesperson confirmed that the new Aveo will be made in China and the U.S., but said the company had not yet decided if the model will be produced in Korea or other countries as well. Currently, the Aveo sold in China is exported from South Korea as complete knockdown kits (CKD) for assembly.
GM Korea also announced late last year that it will not build the next-generation Cruze compact car in South Korea, with production to be move to Europe.
By Dan Mihalascu
PHOTO GALLERY
