Kia Motors proposed to its labor union in South Korea that they want to pause production at three factories in the country due to the virus pandemic affecting exports to Europe and the United States.
Citing a union official, Reuters reports that the union has not decided yet to accept Kia’s proposal, which involves suspending production from April 23 to 29, due to negotiations over pay are still ongoing.
“Kia Motors is currently reviewing the suspension of some of its plants in Korea in response to declining global demand due to COVID-19. However, a decision has not been made at this time,” the company said.
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South Korea’s exports for the first 10 days of April fell by 18.6 percent compared to the same period last year, with shipments of new vehicles and car parts dropping by 7.1 percent and 31.8 percent respectively.
Hyundai, which owns Kia, has also stopped a production line of the Tucson at a factory in Ulsan, which will remain closed until April 17. The two carmakers have suspended production at most of their factories outside South Korea and China. Kia saw its share price declining by 3.4 percent while Hyundai’s shares dropped by 2 percent.
Kia’s latest model is the 2021 Sorento, which made its debut last month. The new SUV is based on a new platform and will be offered with a hybrid powertrain option worldwide.
The coronavirus outbreak will no doubt take a huge toll on the economy this year, as governments around the world impose restrictions on movement to slow the spread.