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South Korea truckers strike again with auto, battery supply chains at risk

With fuel prices rising, truckers are urging the government to extend the 'Safe Freight Rate,' which is set to expire at the end of the year, and to expand benefits for truckers in other industries, including oil tankers.

By Newsd
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South Korea truckers strike again with auto, battery supply chains at risk

South Korean truckers began their second major strike in less than six months on Thursday, threatening to disrupt manufacturing and fuel supplies for industries ranging from automobiles to petrochemicals in the world’s tenth-largest economy. With fuel prices rising, truckers are urging the government to extend the ‘Safe Freight Rate,’ which is set to expire at the end of the year, and to expand benefits for truckers in other industries, including oil tankers.

The government has stated that the scheme will be extended for three years, but has rejected other union demands. In June, a nonviolent eight-day trucker strike disrupted cargo shipments across Asia’s fourth-largest economy, costing more than $1.2 billion in lost output and missed deliveries before it ended with each side claiming victory. On Thursday morning, the organising union held 16 rallies across the country, including one at a port in Ulsan that houses Hyundai Motor’s main manufacturing plant. The union estimated that 22,000 people attended the rallies, while the transport ministry estimated that 9,600 people attended and that there were no clashes with police who were monitoring the events.

Hundreds of truckers marched around the transport hub Uiwang, 25 kilometres (15 miles) south of Seoul, carrying banners and wearing headbands with the slogan “Unite Fight” as a loud rally got underway. “We stop, the world will stop!” they chanted, and “Let’s stop driving to change the world!” According to union officials, approximately a thousand truckers attended the rally, where the head of the union’s Seoul metropolitan area branch, Lee Kwang-jae, instructed them to take up key positions in order to obstruct any attempts to make shipments. One of the protesters in charge called out to a container truck heading for a depot, “Don’t make yourself look bad by working. Come with us!”

They intended to split into two groups, with half staying in Uiwang and the other half travelling to Pyeongtaek, which is about 44 kilometres (27 miles) away and close to Chinese ports. Police officers and buses were seen lined up along key routes in Busan, South Korea’s largest port.

The Cargo Truckers Solidarity Union (CTSU), the strike’s lead organiser, has warned that the strike could disrupt oil supplies at major refineries as well as transportation at major ports and industrial plants. The union has stated that almost all of CTSU’s 25,000 members, or approximately 6% of the country’s truck drivers, will join the strike, along with an unspecified number of non-union members. “We have no choice but to halt all logistics in Korea,” the union’s head, Lee Bong-ju, said on Thursday.

‘BREAK DOWN’ Earlier this week, Transport Minister Won Hee-ryong stated that the Safe Freight Rate system had not been proven to improve trucker safety but only to increase their income, which is why the government has refused to expand the scheme’s scope.

“The government and the ruling party misled the public and openly defended capital by claiming that truckers’ income levels were not low – and that if the Safe Freight Rate system was expanded, prices could rise due to increased logistics costs,” Lee said. The union is requesting that the government hold large corporations accountable if they violate the minimum wage rule.

“Truck drivers on the front lines should not sympathise with unjustified collective action. We will strictly prosecute truck drivers who refuse to cooperate with police in order to ensure safe transportation “Won, the Transport Minister, stated on Thursday. The June strike forced industry titans such as Hyundai Motor and steelmaker POSCO to reduce output, and POSCO has warned that further action could stymie repairs at a major plant hit by flooding this summer.

“If the cargo union strike continues, it will place an undue burden not only on major industries, but also on people’s livelihoods and the national economy,” Prime Minister Han Duck-soo said on Thursday. Companies such as Hyundai Steel, petrochemical firms, and a battery manufacturer told Reuters that because the strike was anticipated, urgent contract volumes were shipped out and raw materials were prepared ahead of time. However, limited storage space and logistics would make a prolonged strike problematic.

Due to the strike, Hyundai Steel’s daily shipment of approximately 8,000 tonnes of steel products at its Pohang factory could not be moved on Thursday, according to a spokesperson. In the event that cargoes pile up, the government is considering deploying alternatives such as military-run container transport vehicles and securing more storage space. According to some industry officials, military vehicles may not be equipped to transport products such as steel or fresh produce.

According to an association official, the Korea Oil Station Association is asking gas station owners to secure enough inventory ahead of the strike, while charging stations for hydrogen-powered cars have posted signs warning that supply may be cut.

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