Indian police disperse Hyundai sit-in strikers

Indian police dispersed dozens of workers occupying a Hyundai Motor plant in Chennai as a strike brought the operations of India’s second largest carmaker to a halt for a second day.

The industrial action was the fourth strike in two years at the South Korean carmaker’s operations in India’s southern state of Tamil Nadu. The stoppages, over the union , could lead the carmaker to consider switching production elsewhere.

Hyundai estimated that the strike in its first day had affected the production of 2,200 cars. The factory near Chennai produces 1,500 cars a day – including the models i10 and i20 hatchback as well as the Verna and Accent sedans – and employs 10,000 people.

Hyundai, alongside other South Korean companies, has enjoyed considerable success in India. A leading car exporter, it pioneered a strategy of making India a small car export hub, while its models have gained in popularity in the domestic market.

The company said local management was in talks to resolve the dispute and hoped operations would resume shortly. The sit-in was called in protest of the earlier dismissal of 67 workers and to demand the recognition of multiple labour unions.

Hyundai has faced increasing labour disputes in its overseas plants this year as it rapidly expands overseas production to join the top ranks of global automakers. Production was halted at its Beijing plant last week as a result of a strike at one of its suppliers.

It produces half its cars abroad with production bases in the US, China, India, Turkey and eastern Europe. But labour unrest has been seen as one of the biggest risks hindering its global ambition.

The company said about 150 workers in the Indian plant went on a sit-in strike. It had sought government intervention for an early settlement to the disputes.

Hyundai, the world’s fourth-largest automaker with affiliate Kia Motors, is riding high on the industry’s strong recovery. It aims to increase global sales this year by 11 per cent to 3.46m vehicles.

Strikes over the recognition of labour unions can turn nasty in India. Two years ago, the Indian chief executive of Graziano, an Italian multinational, was lynched at the gear box manufacturers' premises near the capital Delhi.