Samsung Electronics shares fell 3% after negotiations with striking workers at a factory in India failed. The strike, which began five days ago due to workers’ disagreement with working conditions, has paralyzed the production of household appliances. According to CNBC, this is one of the largest strikes of its kind in India in recent years.
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Hundreds of workers at a plant in the southern Indian city of Chennai that makes televisions, refrigerators and washing machines are demanding Samsung raise wages, reduce working hours and officially recognize their union. Negotiations between union representatives, Samsung management and local labor officials on Thursday failed to produce an agreement. According to local media, about 85% of the plant’s 1,700 workers took part in the protest.
Union leader E. Muthukumar told Reuters that workers would go on strike until their demands for higher wages and better working conditions were met. “Samsung management asked us to stop the strike but did not agree to recognize the union or negotiate with us, so the strike will continue,” Muthukumar said.
However, Samsung declares its readiness for dialogue. Earlier, the management representative stressed that the company actively interacts with its employees to resolve any problems they have and complies with all laws and regulations. “We are also ensuring there are no disruptions in service to our customers and are committed to avoiding supply disruptions,” the company said.
The strike at the Indian plant follows recent protests in South Korea, where about 37,000 members of the largest union called for higher wages and better working conditions. As a result of these events, Samsung shares on the Korean stock exchange have fallen more than 6% since the beginning of this week.
The Chennai plant is one of Samsung’s two plants in India and contributes up to 30% of the company’s $12 billion in annual revenue in the country, according to CNBC. As a leading player in the Indian smartphone and home appliance market, the company’s revenue in this sector was $38.2 billion by 2024.