Renault Samsung suspends plant on chip shortage

Renault Samsung Motors Corp., the South Korean unit of Renault S.A., said Monday it has temporarily suspended its sole plant due to parts shortages.

Renault Samsung will halt the Busan plant, 453 kilometers south of Seoul, from Monday to Tuesday due to lack of semiconductor parts, a company spokesman said.

It is the first time for Renault Samsung to suspend the plant on a global chip shortage.

In May, the company temporarily closed the plant, as its union continued strikes for a wage hike for the year of 2020 amid the prolonged COVID-19 pandemic.

The company and its union have yet to sign a wage deal for 2020.

In January, Renault Samsung entered emergency management after reporting an operating loss of 70 billion won ($61 million) in 2019 for the first time in eight years. It announced its plans to cut the number of executives by 40 percent and their pay by 20 percent. It also offered a voluntary retirement program to all employees.

In a message sent to employees in February, Renault Samsung Chief Executive Dominique Signora said restructuring will be "inevitable" for the company's survival amid the pandemic and lower demand for its models.

Its current passenger car lineup is composed of the SM6 sedan, the XM3 SUV and the QM6 SUV.

From January to June, its sales fell 17 percent to 55,926 vehicles from 67,666 units in the year-ago period. (Yonhap)