The announcement of the road map for firefighting at Kumho Tire's Gwangju plant, originally scheduled for early this month, is expected to be postponed until next month. This is due to diverging opinions between labor and management regarding the production scale of the Jeonnam Hampyeong plant, which will replace the Gwangju plant. While the union suggests that the Hampyeong plant should be built to produce 6 million tires annually, management believes that a suitable output is 3 million tires, half that amount.
According to the tire industry on the 29th, Kumho Tire has reportedly concluded that it will be difficult to present a firefighting roadmap for the Gwangju plant within this month. This is because labor and management have not been able to narrow their differences regarding the contents of the roadmap, and there is also a second-quarter earnings announcement scheduled for the 30th. Kumho Tire was planning to announce the roadmap within two months after a fire occurred at the Gwangju plant on May 17.
The outline of the roadmap has been drawn. The plan is to continue with the transfer of the Gwangju plant, which has been pursued since 2019. There is no disagreement on this matter. The issue at hand is the production scale. The union is demanding that the construction of the Hampyeong plant be divided into two phases and that phase one should enable an annual production capacity of 6 million tires within 2 to 3 years. However, management maintains that an appropriate production volume for the first phase should be around 3 million tires annually.
It is also reported that both sides have different positions regarding the reactivation of the Gwangju plant. The union argues that the first Gwangju plant should be reactivated by adding production facilities lost in the fire. In this case, the Gwangju plant could produce 3 million tires annually. While this is a quarter of the previous output of 12 million tires, the calculation is that by implementing cyclical work shifts and sustaining operations at the Hampyeong plant, it could preserve the jobs of over 2,400 employees who are currently on indefinite standby at home. On the other hand, management has not yet disclosed a clear position regarding the reactivation of the first Gwangju plant.
A union official said, 'The Hampyeong plant is likely to be built with an automated process, making it difficult to accommodate all the production workers from the existing Gwangju plant.' He pointed out, 'If the first Gwangju plant is reactivated, there will be positions for 500 to 600 workers, but management continues to show a passive stance.'
Some in the union and the Gwangju community suggest that Kumho Tire's reluctance to maintain or expand domestic production is due to the influence of its major shareholder, the Chinese tire manufacturer Double Star. Kumho Tire, which was once a subsidiary of Kumho Asiana Group, graduated from workout in 2014 and was acquired by Double Star in 2018.
Kumho Tire has been pursuing the construction of a new factory in Europe alongside the transfer of the Hampyeong plant. This is based on the calculation that tire demand will rapidly increase as Chinese automobile manufacturers continue to establish local factories to target the European market. Management is reported to have expressed the position during recent roadmap discussions with the union that a factory capable of producing 6 million tires annually should be built in Europe.