GM Korea Could Declare Bankruptcy Later This Week As Union Bails On Negotiations

The future of GM Korea is looking pretty bleak as the Korea Metal Workers Union has bailed on a scheduled meeting just days before an April 20th deadline to hammer out a deal.

Wards Auto reports the meeting was cancelled after union officials objected to the sessions being monitored on closed-circuit cameras. No new talks have been scheduled and GM Korea has previously threatened to file bankruptcy if a deal can’t be worked out.

While the decision to have the meeting monitored sounds unusual, GM Korea says it’s a safety issue as several of the union negotiators were involved in the attack on the company’s executive offices earlier this month. Video from the event showed several people entering the office of GM Korea CEO Kaher Kazem and throwing chairs, knocking over plants and removing office furniture. The company later described the event as a “violent incident” that “resulted in significant damage to company property.”

Given the circumstances, a GM spokesperson told the publication the company is “ready to negotiate with the union on an urgent basis, provided the right safety measures are in place.” The spokesperson went on to say “safety is an overriding priority” and the company remains committed to providing a safe work environment for all employees.

If that wasn’t bad enough, the chairman of the Korea Development Bank has revealed it needs additional time to determine whether or not it can provide new financing to GM Korea. The process was originally slated to be complete by the April 20th deadline but the bank now says a determination won’t occur until the end of the month.

It remains unclear if GM will stick with its original deadline or extend the timeline given the latest developments. However, the company has shown it is willing to leave a number of unprofitable markets as the company sold off Opel and Vauxhall and announced plans to phase out the Chevrolet brand in India and South Africa.

  • Rocket

    Neogations? Really CS?

  • LWOAP

    I wonder how the workers will react if GM Korea does declare bankruptcy. I’m guessing more offices will be trashed if they don’t get their pensions or something.

    • Yep, or they can blame the government not to prevent it.

  • I’m trying to grasp the situation but it seems that both sides need each other won’t budge. Many of GM products worldwide are engineered in Korea (Spark, Aveo, Captiva) but they aren’t willing to settle on wage. In the other side Korean government don’t want the plant to be closed and leave thousands of worker, but at the same time they don’t want to give leeway for GM, because they afraid of other companies pulling the same trick.

  • Ilbirs

    Again, this seems to me that there’s something untold about GM’s current financial shape. In a small period of time we see the group leaving Europe (what big auto conglomerate would leave this continent?) and shutting down Indian and South African operations. Will us be faced with another corporate scandal on the likes of what happened to Enron, Worldcom and other ones we’ve seen in the 1990s?

    • Andrew Riles

      Something certainly doesn’t seem right….here in Aus we are wondering how long it will be until GM pulls the pin on Holden, as I think us and Thailand are now the only 2 RHD markets GM has a presence in…..

      • There is Indonesia, Malaysia, Singapore, Japan…

        • Andrew Riles

          Japan they are a bit player, with Chevrolet selling Corvettes and Camaros, presumably in LHD, and strangely, the Captiva. Cadillac also have a presence there….and I believe that most cars sold in Japan are also made there….

          A very quick google suggests their market share in the other three countries you mention is minimal or non existent, but happy to be corrected on that if it is not the case….

  • Bash

    Where did this come from?

  • Liam Paul

    It would be extermly stupid of GM to allow GM Korea to file Bankruptcy. If they cant pay their workers a fair wage, let all of GM go under. Let all the CEO’s have nothing too. It’s not unions that are greedy, it’s corprate that is greedy

  • EyalN

    a company that started without owners, only shareholders. the shareholders just care how much money they will make by the end of the month. GM always did stupid stuff. they don’t really need GM korea, most of GM cars are made in china but the way they dump europe and korea like they are going out of business is sick.

  • Go home, you are drunk.

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