Synopsis
On March 14, Hyundai Steel announced its shift to emergency management due to challenges like U.S. steel tariffs and labor disputes. Executives face a pay cut, and operations are being reviewed as the company navigates these pressures.Key Takeaways
- Hyundai Steel shifts to emergency management mode.
- Executives face a 20 percent salary cut.
- Company reviews voluntary retirement program.
- Operations are affected by U.S. steel tariffs.
- Strikes disrupt production amid labor negotiations.
Seoul, March 14 (NationPress) Hyundai Steel announced on Friday that it has transitioned to an emergency management mode due to escalating challenges, which include the recent implementation of steel tariffs by the United States and ongoing disputes with unionized labor.
The firm revealed that all executives will undergo a 20 percent salary reduction starting Thursday, and it has initiated a review of a voluntary retirement program for its workforce.
Furthermore, the company intends to limit international business travel and enforce significant cost-cutting strategies throughout its operations, as reported by the Yonhap news agency.
This decision from Hyundai Steel, the second-largest steel manufacturer in South Korea by sales, underscores the increasing pressure on the domestic steel sector.
Hyundai Steel has already reduced operations at its Pohang facility due to decreased demand stemming from a downturn in the local construction industry. Additionally, it is contending with a surge of low-cost steel imports from China and Japan, which have diminished its market share within the country.
The company’s predicament has worsened due to President Donald Trump's recent decision to enforce a 25 percent tariff on steel imports, including those from South Korea, effective this week.
Moreover, Hyundai Steel has been engaged in extended wage discussions with its labor union since September, which have included multiple strikes, both partial and full-scale, disrupting production.
"Without decisive self-rescue actions, enhancing the company's financial standing amid severe domestic and global crises would prove exceedingly challenging," the company stated.
In a related note, Hyundai Motor Group reported that it has received the highest number of accolades from an annual crash safety evaluation conducted by the U.S. Insurance Institute for Highway Safety (IIHS) compared to its global automotive competitors.
According to the group, five models from Hyundai, four from Genesis, and two from Kia achieved Top Safety Pick+ (TSP+) accolades in crash assessments carried out by the IIHS. The Genesis' GV90 was also honored with a TSP award.
Models recognized for their outstanding crash safety include the Ioniq 5, Ioniq 6, Tuscon, and Santa Fe SUV, alongside the Genesis GV70 and GV80.
Significantly, the Tucson, GV70, and GV80 have received TSP+ ratings for five consecutive years, starting in 2021.
