Kumho Tire Labor and Management Reach Tentative Wage Deal Ahead of Strike... 3% Base Pay Raise, 8.5 Million Won Incentives

A Dramatic Breakthrough Amid Internal and External Crises, Including the Gwangju Plant Fire and Tariffs

Returning Employees to Work, Implementing Job Training and Reassignments

Union Member Vote Scheduled for the 23rd and 24th

Strike Threat All but Resolved If Approved, First Time in Five Years

Kumho Tire's labor and management, which had been mentioned as being on the brink of their first strike in five years, have reached a tentative agreement on this year’s wage and collective bargaining negotiations.

Amid growing management uncertainty both inside and outside the company due to factors such as last year's Gwangju plant fire and tariffs, the significance of this agreement is that both parties have come together not only on wage issues but also on ensuring sustainable operations of domestic plants, job security, and securing future competitiveness.

According to Kumho Tire on the 21st, labor and management held negotiations that day and reached a 'tentative agreement for the 2026 wage and collective bargaining negotiations.'

Kumho Tire exterior view

The main points of the tentative agreement include a 3% increase in base salary, a 5.5 million won management performance incentive, a 2.5 million won incentive for fulfilling the 2018 special agreement, and a 500,000 won work encouragement bonus. In addition to the base salary increase, the various incentives and bonuses amount to a total of 8.5 million won.

In particular, for the operation of the management performance incentive, labor and management have established a foundation to comprehensively consider various management situations. By creating a structure that enables more rational discussions on performance-based compensation—an issue that has emerged as a key topic in annual negotiations—they are expected to reduce unproductive conflicts in future negotiations.

The tentative agreement focuses not only on wage increases and performance-based compensation, but also places significant emphasis on the sustainable operation of domestic plants, job security, and enhancing future competitiveness.

Labor and management have agreed to work together to increase quality and productivity for market expansion and future competitiveness, as well as to further enhance technological and facility competitiveness. They also plan to establish workplace discipline, improve productivity, and work together to create a safe and efficient work environment.

Above all, both sides reached consensus on the highest-priority issues that emerged after last year’s Gwangju plant fire—such as job security for workers and a smooth return to work.

Labor and management agreed to prioritize employee job security and economic stability. They plan to support stable work conditions and facilitate the return to work for employees on leave due to the fire, and also intend to implement job training and reassignment this year through a separate agreement—considering vacancies due to retirements and the time needed for workforce development.

Measures have also been prepared to restore normal production and lift employee morale. They plan to operate a special reward system for meeting planned production targets and expand a variety of labor-management exchange and communication programs to promote pride and work efficiency among employees.

This agreement has drawn particular attention, as it comes at a time when the union had kept open the possibility of a general strike.

Since the initial meeting in May, Kumho Tire’s management and union engaged in 14 rounds of collective bargaining, but differences remained over wage increases and performance-based incentives. After the union declared the breakdown of negotiations last month and then approved a strike vote earlier this month, the situation moved towards a strike.

In particular, with the union announcing the possibility of launching a general strike from the 29th, concerns were raised that the first strike in five years could materialize.

The company, meanwhile, faced burdens from the need to restore normal operations and recovery at the Gwangju plant after the fire, while also having to secure future production bases such as the new Hampyeong plant. Prolonged labor-management conflict would have imposed significant pressures. Ultimately, both sides built consensus that restoring production, securing jobs, and enhancing future competitiveness should take priority over mutually destructive strikes, leading to this dramatic tentative agreement.

However, this year’s wage and collective bargaining agreement has not been formally ratified yet.

The union will hold a vote among its members on the tentative agreement from the 23rd to the 24th. If the tentative agreement is approved in the vote, the possibility of a general strike will be virtually resolved, and Kumho Tire’s labor and management are expected to be able to fully focus on normalizing Gwangju plant operations and securing future competitiveness.

A Kumho Tire official stated, "While management-labor confrontations are ongoing at many sites, it is significant that both sides managed to build consensus for the future, overcoming the aftermath of the previous fire without physical clashes. This year’s tentative agreement will be a great foundation for enhancing Kumho Tire’s competitiveness."

This content was produced with the assistance of AI translation services.