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GM Korea Research Spinoff Sparks Plans for Strike, Lawsuit
A decision by GM Korea to spin off its r&d unit has prompted threats of a strike by its labor union and a lawsuit by its second-largest shareholder to nullify to plan.
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A decision by GM Korea to spin off its r&d unit has prompted threats of a strike by its labor union and a lawsuit by its second-largest shareholder to nullify to plan.
The move by the General Motors Co. affiliate comes five months after GM Korea averted bankruptcy by closing a plant, winning labor concessions and arranging a $750 million bailout package from the Korea Development Bank, which owns 17% of GM Korea.
Workers consider the move, which would make the r&d facility an independent entity called the GM Technical Center Korea, a step toward shutting down manufacturing operations in Korea.
GM, which own 77% of GM Korea, say a 75% “yes” vote was sufficient to approve the measure. KDB complains that it wasn’t notified about the spinoff and insists that an 85% majority is required for approval.
GM Korea lost 3.1 trillion won ($2.9 billion) between 2014 and 2017. The carmaker’s sales plunged 35% to 66,300 vehicles through the first nine months of 2018, but the company has predicted a profit next year.
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