South Korean truckers resume strike to block ports and manufacturing

Drivers moving containers walked off work on Thursday, leading to a 60% drop in container volumes (Busan city government)

Posted on November 24, 2022 at 1:45 p.m. by

The Maritime Executive

For the second time in months, South Korean truckers went on strike Thursday morning, threatening major supply chain disruption and specifically targeting ports and the auto industry. The previous strike in June 2022 spanned a week to implicate tens of thousands of drivers, with the government estimating economic damage at $1.2 billion.

As a condition for ending the eight-day strike in June, South Korea’s transport ministry had agreed to consider expanding the trucking tariff system to cover additional products. On Tuesday this week, November 22, the Cargo Truckers Solidarity Union (CTSU) announced that the union had decided to resume the strike due to the government’s failure to raise the minimum wage and deliver on its promise to renew the Safe system. Trucking Freight Rates.

It is estimated that more than 22,000 unionized truckers walked off the job early today. Although this is only a small fraction of the more than 420,000 unionized drivers in Korea, reports indicate that union leaders have ordered members to blockade major transport sites, including in Uiwang, Busan and Pyeongtaek . These cities are home to South Korea’s main industrial factories and ports.

Among the locations targeted by drivers are major container ports in South Korea. The Ministry of Lands, Infrastructure and Transport confirmed that container movement fell by 60 percent today, with less than 15,000 TEUs handled at ports such as Busan and Gwangyang.

CTSU members would be concentrated in important sectors, including the shipping of cement, steel, automobiles and petrochemicals as well as containers. Their number has also increased to represent more than half of tank truck drivers.

Hyundai Steel said during the first day of the strike that it could not transport more than 8,000 tonnes of steel products to its Pohang plant. Other industries are likely to be affected if the strike continues, including automakers. During the June strike, production of Hyundai vehicles at the Ulsan plant fell to less than 60% of normal output and the Ministry of Commerce estimates that the June strike cost automakers more than $188 million. dollars.

“We have no choice but to stop all logistics in Korea,” CTSU chief Lee Bong-ju said. “The government and the ruling party have misled and openly defended capital by saying that truckers’ income levels are not low and that if the safe freight rate system is extended, prices could rise in due to increased logistics costs.

Citing the rising cost of fuel, drivers are calling for an increase in the minimum wage as well as the renewal of the tariff system, which guarantees minimum freight rates for truck drivers and sets safety rules. The system was introduced in 2020 and expires at the end of this year, while the union is asking for a three-year extension.

Speaking earlier this week, the Minister for Transport argued that the Safe Freight Rate system has been proven not to improve the safety of truckers, insisting that it is designed to increase the revenue of the trucking while increasing logistics costs. However, the government has indicated that it supports the extension of the system, but according to the union it will only be renewed for container and cement transporters.

The government had threatened in June to break the strike but succeeded in putting the drivers back to work by promising them new negotiations. The CTSU maintains there has been no progress in the past six months, saying it is prepared to strike until legislation to make the Safe Rates system permanent and extend coverage to more sectors be adopted in the National Assembly.

The Ministry of Lands, Infrastructure and Transport responded by saying it was taking action to mitigate the impact of the latest walkout while warning to act quickly if drivers take illegal action to block shipments. They threatened to impose a back-to-work order that would result in jail and fines.

Marjorie N. McClure