Kia is preparing to exit the large bus business, a move that would bring to an end more than five decades of production dating back to its predecessor, Asia Motors.
According to Kia's labor union on Wednesday, the company informed workers at a labor-management employment stability committee meeting that it plans to discontinue production of the Granbird large bus within the next one to two years.
If implemented, production of large buses within Hyundai Motor Group would be consolidated under Hyundai Motor.
The move comes as Korea's bus market faces sluggish demand and weakening profitability.
Domestic bus sales have remained subdued in recent years, while low-cost Chinese manufacturers have steadily expanded their presence. At the same time, stricter emissions regulations have increased development and production costs, adding pressure on profitability.
The plan, however, is expected to face resistance from labor unions.
The Gwangju branch of Kia's labor union, affiliated with the Korean Metal Workers' Union, said it could not accept the end of bus production without concrete measures to protect jobs.
The union said it would suspend labor-management consultations and called on the company to present employment guarantees and a long-term operating plan for its plants in Gwangju and Hanam, Gyeonggi Province .
By Hwang Sun-jun (shwang9@heraldcorp.com)
