Hyundai output disrupted by strike at key supplier
SEOUL: South Korea's top automaker the Hyundai Automotive Group said Monday its production has been disrupted by a strike at a core engine parts supplier.
Yoosung Enterprise, which makes piston rings, cylinder liners and camshafts, closed its factories last Thursday after unionised workers launched a strike for better pay and working conditions.
Yoosung provides engine parts for around 70 percent of vehicles made by Hyundai Motor and its affiliate Kia Motors.
Together they form a group that is the world's fifth-largest automaker by sales, with an increasing presence in major automobile markets including the United States, China and Russia.
The shortage of parts has disrupted production of Hyundai's sport utility vehicles such as the Tucson ix, Santa Fe and Veracruz, as well as Kia's Carnival model.
But the group said production of all models save for some small cars would inevitably be affected soon.
"Exports are okay for a while but our domestic sales will be seriously disrupted" if the strike continues, a Hyundai spokesman told AFP without giving any figures.
NH Investment and Securities analyst Jess Lee told Dow Jones Newswires that Hyundai and Kia have two months' inventory of completed vehicles in global markets.
Yonhap news agency predicted that Hyundai and Kia would be forced to curtail output by some 40,000 units this month if the walkout continues until the end of May.
Copyright APP (Associated Press of Pakistan), 2011
Copyright AFP (Agence France-Presse), 2011
Comments
Comments are closed for this article.