GM Korea wants to outsource production for exports to subcontractors by 2014, endangering the jobs of at least 1,000 employees in Korea.
GM executive Tim Lee explained plans to outsource production of so-called "completely knocked-down" cars for export at GM Korea headquarters on Friday. CKD cars were manufactured in one country and then exported to another country for final assembly.
Last year, CKD cars took up 62 percent or 1.28 million units out of 2.08 million of GM Korea's total production. According to the company, over 10,000 people work in production full-time, and 2,000 of them work on CKD assembly lines.
GM Korea plans to lay off 1,000 of them through voluntary retirement or other redundancy measures. That means 10 percent of the total workforce in production will be subject to downsizing.
GM blames the high production cost in Korea. Over the past several years, labor costs in other overseas plants of GM decreased, but in Korea they rose, it said.
However, the company's labor union has already voiced strong opposition and vowed to scupper the plan.