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GM Daewoo Employees Approve Wage Agreement


August 2005
 Filed under: DAEWOO Car News | DAEWOO Headlines

GM Daewoo to acquire DIMC's Bupyong facility

Seoul, Korea - Union members at GM Daewoo Auto & Technology (GM Daewoo) and Daewoo Incheon Motor Company (DIMC) today ratified an agreement on wages. This represents the first labor agreement among Korean auto makers this year.
The agreement, which was supported by 56 percent of union members who voted, was finalized on August 2 after 12 days of negotiations. It includes a KRW 85,000 basic monthly wage increase in 2005 (representing a 6.77 percent increase in base wages). A further KRW 62,310 monthly wage increase will be paid in 2006 to enable GM Daewoo to catch up to its domestic competitors effective April 2006. In addition a lump-sum bonus payment of KRW 1.5 million in celebration of the agreement, and a KRW 1 million bonus to be paid at the end of the year.

During the talks, GM Daewoo announced that it would begin the necessary legal proceedings for the acquisition of DIMC immediately following the satisfactory conclusion of wage negotiations. The acquisition of DIMC's Bupyung manufacturing facility in Incheon is expected be completed within the year.

' This agreement is by far the most significant in our less than three-year history. It puts all the elements in place for the full normalization of our company,' said GM Daewoo President and CEO Nick Reilly. ' We believe we have reached a settlement that is fair to our employees while ensuring the sustained, long-term development of GM Daewoo. We appreciate the effort of the labor union to negotiate in a spirit of cooperation.'

Reilly added, 'The acquisition of DIMC, which is taking place sooner than we had anticipated, is being made possible by the close cooperation between labor and management as well as the outstanding performance and high degree of motivation of the facility's employees. In addition, Bupyong accounts for nearly half our production. It has full engine and transmission manufacturing facilities and provides components to our other manufacturing facilities. Integrating Bupyong provides us full control over all aspects of the business and allows us to better able control our own destiny. Most importantly, it will allow us to truly operate as one company.'

DIMC President Suk-Hwan Kim said, 'We are pleased that GM has decided to proceed with the early acquisition of DIMC. This has been the most important goal of our employees. As a formal part of GM Daewoo, we look forward to a new beginning and to helping GM Daewoo achieve its long-range targets.'

Following the acceptance of the new labor agreement, an official signing ceremony is scheduled to be held at DIMC's Bupyung plant during the week of August 15.

GM Daewoo Auto & Technology, based in Incheon, Korea, was established in 2002. It has five manufacturing facilities in Korea as well as an assembly facility in Vietnam. GM Daewoo products are also assembled at GM facilities in China, Thailand, India, Colombia and Venezuela. In 2004, GM Daewoo sold over 9 00,000 vehicles with exports to more than 1 5 0 countries. Imported GM products from the Cadillac and Saab premium brands are sold in Korea through GM AutoWorld retailers. More information on GM Daewoo and its products can be found on the company's corporate website at www.gmdaewoo.co.kr.

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