The South Korean cargo truckers have started an indefinite strike in protest against high fuel prices and tearing down safety measures. The strike has spread to other industries and is part of a growing global working class movement against inflation and other attacks on living standards. POSCO may halt some of its plants due to the strike. The company has already shut down one plant in response.
The indefinite strike is adding another layer of disruption to global supply chains, as the South Korean company has suspended production at some plants due to a labor dispute involving truckers. Two cold-rolled steel plants and four wire-rod factories in Pohang have stopped production, and the company is running out of warehouse space. The halt is expected to reduce daily output of wire rod and cold-rolled steel by about 4,500 tons. Following the news, shares in the Pohang-based steel maker fell as much as 3.4% in Seoul’s early trading session.
The strike has caused $1.2 billion in lost sales and unfulfilled deliveries. POSCO has suspended some of its plants due to a lack of space. It has also halted production at the factories of Hyundai Motor Co., which produces the Hyundai IONIQ 5 all-electric model and the Genesis GV80 SUV. In addition, cement firms are facing problems delivering finished products.
Among the industries hit hardest by the trucker strike are the steel and cement industries. The truckers’ strike is hindering the movement of critical export goods. It has affected Posco’s ability to ship 35,000 tons of steel daily, which is a significant amount when compared to its normal capacity of 100,000 tons per day. It may even have to further reduce production as a result of the strike. The company’s products have begun piling up in parking lots and on roads.
According to the Land Ministry, the strike is due to the striking truckers’ demands of extended subsidies. Truckers have said they will continue their strike until the government passes new legislation, but the ministry is urging truckers to return to work. Meanwhile, the government has pledged to reflect their demands in the legislative process. In addition, it hopes to end the strife through dialog with the truckers’ union.
While the union is not threatening to shut down all of their plants, it is still holding meetings with the government. The government and union have already met four times to negotiate a settlement and a solution to the strike. Despite these talks, the strike has not stopped the production of some factories. Some cement companies are still storing their finished products, while others are halting operations.