Sunday, October 2, 2022

Cars, computer chips, steel supplies at risk as South Korea’s truckers continue to strike

Cars, computer chips, steel supplies at risk as South Korea's truckers continue to strike

Thousands of South Korean truck drivers were on strike for the sixth day on Sunday, protesting wages as fuel costs rose, disrupted production, slowed port operations and posed new risks to a strained global supply chain.

Production at Hyundai Motor Company’s biggest factory complex in Ulsan fell by nearly 60 percent on Friday, a union official at the automaker said.

Plants operate for additional runs over the weekend to clear backorders. Hyundai said there was disruption but declined to give details and expressed hope for normalcy at the earliest.

The union says Hyundai Motor’s Ulsan factories make about 6,000 vehicles a day. The strike had cost the automaker 4,000 to 5,000 vehicles as of Friday – worth up to $235 billion (€171m).

A Reuters eyewitness said several hundred truck drivers staged a sit-in outside Hyundai’s Ulsan complex over the weekend, but did not stop vehicles from moving in or out.

Media reported that workers at Kia Corp’s Gwangju plant were using newly assembled cars for delivery.

Batteries

LG Energy Solutions, SK Innovation’s battery unit SK On and Samsung SDI together account for more than a quarter of the global electric vehicle battery market.

A company official said one in three made the shipment before the strike as a precaution. The official said the firm did not experience disruption last week, but would re-evaluate its handling of shipments if the strike continues.

semiconductor

Union official Park Jeong-tae said truck drivers were planning to halt shipments of raw materials for semiconductors produced in Ulsan.

Samsung Electronics Co and SK Hynix, the world’s two largest memory chip makers, declined to comment.

A major tech maker does not expect near-term disruption given its inventory of raw materials, an official said.

cement, steel

Steel maker Posco said the strike had halted shipments from the two plants by about a third, or 35,000 tonnes per day.

A major cement maker had on Friday halted shipping for four days with truckers out of the gate, running out of raw materials and affecting storage capacity, an executive said.

Truckers blocked entry to the Hanil Cement Company and Sungshin Cement Company workplaces in Chungcheong province, Newsys reported. The company plans to promote shipping by train to reduce the impact.

Refiners, Petrochemicals

The truck union’s park said the number of vehicles entering the Ulsan Petrochemical Complex has fallen by nearly 90 percent from the normal level and truckers are asking non-union drivers not to enter the complex.

A person familiar with South Korea’s petrochemical operations said the strike threatened logistics for polyethylene and polypropylene.

A major refiner had not seen much impact on shipments and deliveries as of Thursday, and petrol stations usually had inventory to cover two weeks, a company official said, but the situation could worsen if the strike was prolonged. Caste.

South Korea has the fifth largest refining capacity in the world and at the beginning of 2020 the crude oil distillation refining capacity stood at 3.3 million barrels per day.

Height Jinro

Police have made more than two dozen arrests, including members of the truckers’ union, for blocking the Haight Jinro brewery in Incheon, southeast of Seoul, Yonhap News reports.

port and container

Busan Port, the world’s seventh-largest container port, said the strike had reduced its container traffic by two-thirds of normal levels.

A government official said containers are filling up storage space and officials are discussing ways to secure more.

The movement of containers at Ulsan port, which accounts for about 10 percent of South Korea’s port traffic, has been suspended since Tuesday, a government official said.

Nation World News Desk
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