Abstract

Hyundai Motor Co., formed in 1967, was a part of the large South Korean Chaebol - the Hyundai Group - until the group split in September 2000. In the last four decades, Hyundai managed to establish itself all over the world as a company producing reliable, technically sound and stylish automobiles. In the 90s, the company started aggressive overseas expansion programs. By the late 90s, when Southeast Asian crisis struck, the company like all the other chaebols, faced serious financial problems. To survive, it had to cut its labor force. The company offered various retirement schemes, unpaid leave for two years, etc. to workers, and expressed its inability to support its entire workforce in the slack period. The unions refused to compromise and the management too held its ground. Finally, the government intervened to force a negotiated settlement between the union and the management.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Damage that unhappy management-labor relations can cause to an organization.

Keywords

Hyundai Motor Co., Labor Unions, Southeast Asian Crisis, Hyundai Group, Chaebols, International Monetary Fund, IMF, Daewoo Group, Federation of Korea Trade Union, FKTU, Korean Confederation of Trade Unions, KCTU, Voluntary Retirement Schemes, Corporate Restructuring, Ulsan Plant, General Motors, Compensation Plan, Management-Union Relationship