The South Korean city of Gwangju has seen a steady exodus of manufacturing jobs move to low-cost countries. Many job seekers say they would work for the plant in a heartbeat.
Park Byung-kyu once led Kia Motor's union in the city of Gwangju, fighting for labor protections against the powerful, family-run chaebol that dominated the economy during South Korea's rapid industrialization.
The $616 million plant would create 1,000 jobs, but at less than half the wages of Hyundai's unionized workers and without many of the privileges they currently enjoy. The Moon government plans to provide financial assistance to the Gwangju plant, and also introduce similar government-business ventures in two other cities by June.
Home to Kia Motor's largest domestic production facility, Gwangju is South Korea's No.2 motor city after the southeastern city of Ulsan, generating over 40 percent of its manufacturing output from the auto sector. "Its wage is still above the average worker's wage. In that sense, it is not a bad job. It is a good job," the 32-year-old Kim said at a recent job fair held at the city hall.
Park said he borrowed the idea from Volkswagen's now-defunct low-cost division Auto 5000, which was created in 2001 to keep jobs from moving out of Germany. The project came to end in 2009, after the automaker won wage concessions from its powerful and highly paid legacy workers.Gwangju also hopes to make electric vehicles at the plant in the future, although it has yet to be agreed with Hyundai.
"Under such conditions, we believed that we would be able to secure competitiveness when we outsource mini-vehicle production to the newly created corporation," Hyundai said in a statement to Reuters.
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