AutoBeta(AutoBeta.net)09/29 Report--

At present, the impact of the COVID-19 epidemic on the global market can not be ignored, and the global automobile industry is experiencing a severe test this year. Renault Samsung, one of South Korea's top five automakers, has announced a 24-day suspension of production, CCTV Financial reported.

Recently, South Korea's Renault Samsung announced that its only factory in South Korea, Busan, will suspend car production for 24 days from the 25th of this month to the 18th of next month in order to adjust production due to a backlog of inventory caused by low sales. The Renault Samsung Automobile Union said that the labor and management sides had not made any progress after six negotiations, and that the shutdown was aimed at creating profits for the company by reducing workers' wages. stopping production soon after the launch of the new car XM3 was the wrong management strategy of the company, which should be held responsible.

Data show that Renault Samsung car, formerly known as Samsung Automobile, was established by Lee Kun-hee, then president of Samsung Group, in 1994, and began to launch automotive products for sale in 1998. At the same time, Samsung cars were ceded and sold by the group soon with the attack of the Asian financial turmoil. In September 2000, Renault bought a 70 per cent stake in Samsung for a total price of $512 million, and now has a factory in Busan, South Korea, with an annual capacity of 240000 vehicles, mostly for export. Four of the seven models sold by Renault Group in China come from the factory.

Although Renault Samsung is one of the top five vehicle manufacturers in South Korea, the overall sales situation is not optimistic. According to the official website of Renault Samsung in South Korea, Renault Samsung currently has four models on sale in South Korea, namely the SM6, QM6, XM3 and SUV SM3 Z.E. Data show that Renault Samsung exported only more than 12400 cars in the first half of the year, less than 30 percent of previous years, and is expected to sell about 100000 vehicles in South Korea this year.

The current sales downturn of Renault Samsung has a lot to do with not only its own problems, but also the trend of the Korean market. In the first half of this year, the export volume of South Korea's five largest vehicle manufacturers decreased by nearly 30% compared with the same period last year. Kia and Ssangyong both stopped production due to the downturn in overseas markets and blocked exports.

Affected by the suspension or reduction of production by vehicle manufacturers, South Korean auto parts enterprises are also facing an operational crisis. According to the statistics of Korea Automobile Industry Association, nearly 60% of the 84 listed auto parts enterprises lost money in the first half of the year, while some small and medium-sized auto parts enterprises that are highly dependent on vehicle manufacturers are facing the situation of workers staying without pay or even closing down.

At present, South Korean automakers are looking for ways to cut spending. Hyundai Motor and trade unions recently signed an agreement to reduce corporate spending by freezing wages, the third time Hyundai Motor has frozen wages after the 1998 foreign exchange crisis and the 2009 financial crisis, in an effort to cope with the spread of the epidemic. Ssangyong Motors raises money by selling non-core assets, which can be said to be under consideration except for the factory's core production equipment. In the face of the long-term impact of the global epidemic on the automobile market, how should the Korean automobile industry deal with it?

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