Kona production halted due to prolonged strike at Hyundai Transys

(Hyundai Transys)

Production of the Hyundai Kona has come to a standstill as a result of an ongoing strike at Hyundai Transys, a Hyundai Motor Group affiliate responsible for manufacturing parts for Hyundai vehicles. On Monday, Hyundai Motor Company announced the suspension of operations on select lines at Ulsan Plant No. 1, which assembles the popular SUV model.

According to industry sources, Hyundai Motor notified the Ulsan Plant’s committee of the planned halt on the plant’s Line 1, scheduled to last from November 5 through 8. The automaker explained that it is facing difficulties securing the necessary transmission components for the Kona due to the full-scale strike that Hyundai Transys started on October 23. The strike has disrupted the supply chain for the Intelligent Variable Transmission (IVT) parts used in the Kona, known by its internal code, SX2.

Since June, Hyundai Transys has been in negotiations with its labor union over wage and collective bargaining terms. However, a dispute over the size of performance bonuses has stalled progress. The union is demanding 234 billion won ($170 million) as a bonus—roughly 2 percent of the company’s estimated revenue of 11.7 trillion won for 2023. Management, however, views the proposed amount as excessive, pointing out that it nearly doubles last year’s operating profit of 116.9 billion won.

After nearly four months of negotiations with no breakthrough, Hyundai Transys’ Seosan branch of the Metalworkers’ Trade Union began striking in early October. On Monday, the union held its 15th countermeasure committee meeting, formally voting to intensify its strike with a complete walkout set for November 5 to 8. Strikers have held protests at both Hyundai and Kia headquarters in Seoul and even in the vicinity of Hyundai Motor Group Chairman Chung Eui-sun’s residence.

Industry analysts estimate that the ongoing strike could impact around 27,000 vehicles in terms of lost production, potentially costing Hyundai and Kia a combined 1.2 trillion won in losses. Meanwhile, Hyundai also disclosed on Monday that operations would be suspended on Line 2 at Ulsan Plant No. 1, further complicating its production outlook amid ongoing labor disputes.