16-07-2025
Kumho Tire union slams relocation, delays recovery plan
Korea's second-largest tire manufacturer, Kumho Tire, is facing a labor dispute over its yet-to-be-announced recovery plan following a major fire at its Gwangju plant in May, raising concerns over when the company will restore full production capacity in the city.
On Wednesday, the Kumho Tire chapter of the Korea Confederation of Trade Unions announced it would stage a protest in front of the company's Seoul office on Thursday, criticizing management for reportedly seeking to scale down domestic production as part of its post-fire recovery plan.
'The union found that Double Star — Kumho Tire's largest shareholder, based in China — is planning to build a new plant in Korea with an annual capacity of 3.5 million tires, which is smaller than the current Gwangju facility, while fast-tracking a new 6 million-unit plant in Europe,' the union said.
'We began talks over the plan on June 30 and have protested since, but the company has shown no signs of changing it.'
Since the 76-hour fire broke out on May 17, severely damaging the Gwangju No. 2 plant, Kumho has yet to present a clear recovery plan. Operations at both the damaged facility and the adjacent, unaffected No. 1 plant have remained suspended.
This has fueled speculation about the company's future production plans — whether it will restore the Gwangju plant, relocate to Hampyeong in South Jeolla Province, or shift production overseas.
Separately, Kumho Tire has been considering its first European plant to strengthen its presence in the region, which accounts for around 25 percent of its total revenue. Poland, Serbia and Portugal were shortlisted as candidate sites a month before the Gwangju fire.
The union is demanding that the company prioritize restoring the Gwangju plant's original annual capacity of 12 million tires before pushing forward with overseas expansion.
In regulatory filings, however, Kumho Tire said no decisions had been made regarding a potential relocation to Hampyeong or a new European facility.
'The recovery road map is under discussion with the labor union and is expected to be announced within July once it is finalized,' a company official said.
As differences persist between the company and the union over the recovery road map, the announcement, initially planned for early July, is expected to be further delayed, likely slowing the overall recovery process as well.
Meanwhile, the suspension of production at the Gwangju plants, which account for 20 percent of Kumho Tire's total global output, is expected to affect the company's performance starting in the second half of 2025, as domestic inventory runs low, according to Daishin Securities.
