Renault Korea decided to cut vehicle production by nearly 20% from the previous level. It is a response to a sharp drop in sales.
On the 22nd, according to Renault Korea, the company delivered to the labor union a plan to reduce hourly output by 18%, from 55 units to 45. Renault Korea said it is adjusting production to match recently cooled demand.
With the production cut, Renault Korea is also reportedly reviewing redeploying about 10% of production-line workers at the Busan plant, but the company said nothing has been decided.
The decision by Renault Korea was largely driven by falling sales. Last month, Renault Korea sold 4,651 vehicles, down 45.7% from a year earlier. Domestic sales fell 32.2% and exports dropped 64.8% from the same month a year ago. Cumulative sales in the first half were 33,384 units, down 29.0% from the same period last year.
The Renault Korea union recently secured the right to strike after mediation by the labor relations commission failed. The union is expected to decide whether to strike after confirming management's proposal at labor-management talks on the 23rd.