GM Korea union demands new car models as top priority in wage talks

GM Korea's labor union has declared the allocation of new vehicle models as the paramount objective in their wage and collective bargaining talks, highlighting the precarious future of the company's domestic operations.

Union chief Ahn Gyu-baek emphasized the urgency during a press conference, stating that while wage negotiations occur annually, the current models are slated for discontinuation between 2029 and 2032. He expressed concern that without securing new models or replacements in the upcoming negotiations, the company's position with the Korea Development Bank and GM headquarters, particularly as the 2028 deadline for maintaining domestic operations approaches, will be significantly weakened.

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The allocation of new vehicle models is the most important among various issues. Wage negotiations happen every year, but current models are scheduled to be discontinued, some as early as 2029 and others as late as 2032.

Adding to the uncertainty surrounding GM Korea's potential withdrawal, the company has not provided firm commitments regarding the adaptation of its current production models to new North American regulations set to take effect in 2028. These regulations will mandate the inclusion of advanced braking systems capable of detecting pedestrians at speeds up to 100 km/h. The union reported that the company has sidestepped direct answers, citing that the regulations do not yet apply in 2027. Given that over 99% of GM Korea's output is exported, primarily to North America, failure to comply could halt exports.

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We believe that negotiations with the Korea Development Bank and GM headquarters will open up from next year, ahead of the deadline for GM Korea's domestic business maintenance in 2028. If new models or replacement models for current ones are not decided in this negotiation, the government's negotiation will inevitably be disadvantaged.

"To sell cars in North America from 2028, we must meet new regulations. Otherwise, even our current models will face export restrictions," Ahn stated. He urged the company to either invest in upgrading current models to meet the new standards or expedite the introduction of new vehicles.

The union is also exploring the possibility of formally requiring GM Korea to produce models developed by its domestic research and development arm, GMTCK. Ahn pointed out that while GMTCK developed the Bolt EV, its production occurred in North America, not in Korea. The union plans to decide on the scale of future actions based on the progress of additional negotiations scheduled for August 14-16.

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To sell cars in North America from 2028, we must meet new regulations. Otherwise, even our current models will face export restrictions. We must either meet the new regulations through investment in current models or introduce new models early.