Hyundai Motor to cut costs by 20 pct amid sales slump

SEOUL, Jan. 21 (Yonhap) -- Hyundai Motor Co., South Korea's largest automaker, said Wednesday it plans to slash costs by 20 percent this year as the global economic slump sends vehicle sales downward worldwide.

As part of the cost-cutting program, Hyundai will cut the pay of its executives
by 10 percent, the company said in a statement.
Hyundai said the plan will also affect its affiliate, Kia Motors Corp. In a rare
break from convention, neither company has set their sales targets for this year.
"At a time when the global business conditions are extremely unclear, Hyundai
Motor is adopting the belt-tightening measure," a company official said.
Hyundai recently said it was cutting its first-quarter production by as much as
30 percent at its South Korean plants, which account for about half of its total
output, as the global economic downturn sapped demand for new vehicles worldwide.

Executives at the automaker, meanwhile, said that the decision by the company's
union go on strike because of the management's failure to implement a trial shift
system should be reconsidered.
They said the decision made Monday is regrettable since the current crisis
confronting the auto industry as a whole requires close cooperation between
management and labor.
Union leaders said that the company has failed to honor a deal that would allow a
new shift system at Hyundai's Jeonju factory, which would have halted the
overnight shift, but would have allowed the same number of cars to be produced.
But the agreement, which was reached before the global economic slump took hold,
has become non-viable since rising inventory is forcing Hyundai to cut production
altogether.
The company has not revealed any numbers on the size of its inventory, but
industry sources have said it has been rising steadily in the past few months as
people cut back on spending.
yonngong@yna.co.kr
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