| A Hyundai Motor employee assembles a vehicle at the company's plant in Ulsan in this undated file photo. Courtesy of Hyundai Motor |
EVs, future cars require less manpowe
By Nam Hyun-woo
Thousands of manufacturing jobs at Hyundai, Kia and other automakers here will disappear when electric vehicles (EVs) and other future cars become mainstream, according to industry analysts Wednesday.
They said the size of job cuts will differ depending on the share of fully-electrified cars in the future market, but it seems inevitable for carmakers to trim their conventional jobs, given Hyundai Motor's recent argument with its labor force over job cuts stemming from EVs and hydrogen cars.
"An engine car is comprised of approximately 30,000 parts, while an EV needs 20,000 parts," Prof. Hwang Sung-ho at Sungkyunkwan University's Mechanical Engineering Department.
"This does not necessarily mean that the workforce required for an EV is two-thirds of that of an engine car, but to the question of whether EVs require less labor force, the answer is yes," he said. "There will be job cuts due to the decrease in the number of parts required and a massive number of personnel relocation will follow."
Hwang's comment came amid the argument between labor and management of Hyundai Motor over estimated job cuts stemming from the automaker's shift of focus to EVs and hydrogen cars.
According to Hyundai Motor officials, the management has recently told the union that it estimates 7,000 jobs will be slashed in 2025, as it expands its manufacturing volume of eco-friendly cars while shrinking the share of engine cars.
Hyundai Motor plans to assemble 450,000 green cars in 2025 by setting up two EV-making assembly lines in its Ulsan factory. Due to this, 3,000 jobs will disappear and additional changes in the manufacturing process will cost 4,000 more jobs, the company expects.
This is similar to a recent move by Volkswagen, which announced earlier this month that it is planning to cut 5,000 to 7,000 jobs by 2023 by not hiring new employees.
The union, however, claimed that the company has to hire 10,000 additional employees by then, because 17,500 people are scheduled to retire by then. The union cited a clause in its agreement with the management, stating the company should directly hire necessary employees if a position is vacated due to retirement.
"Even though we accept the management's anticipation of cutting 7,000 jobs by 2025, 17,500 are scheduled to retire by then. Thus the company has to hire at least 10,000 to keep its plant running," Hyundai Motor union leader Ha Boo-young said in an interview with a labor publication.
Hyundai Motor officials said that it is yet to decide whether to fill the vacancy with new employees or follow the Volkswagen path, but Hwang said it seems inevitable for Hyundai to downsize its workforce.
"Pursuing EV or other eco-friendly cars is a must, not an option," Hwang said. "If domestic automakers refuse to change, they will fall behind and bring about the collapse of the entire automotive industry."
"New jobs will be created, while more jobs will disappear. If side effects of job cuts are expected, then both labor and management should compromise some of their arguments and find a point where they can both agree," he said.
He added automakers should make efforts to educate and train their employees to embrace the technological change, while unions also have to accept the change in the industry and find ways to transform themselves.