A looming 18-day strike at South Korean chip giant Samsung that has triggered worries within the government, rattled foreign investors, and threatened global supply chains rests on one crucial question: Who should share in the spoils of the AI boom? More than 45,000 workers are threatening to stage the largest strike in the conglomerate's history from May 21, reducing production of memory chips that are crucial components in AI data centers, smartphones, and laptops, as Samsung and its union struggle to find a compromise over bonus payouts.
The looming 18-day strike at South Korean chip giant Samsung, which has triggered worries within the government, rattled foreign investors, and threatened global supply chains , is a result of a contentious wage negotiation over bonus payouts .
More than 45,000 workers are threatening to stage the largest strike in the conglomerate's history, reducing production of memory chips that are crucial components in AI data centers, smartphones, and laptops. Samsung Electronics, which has reaped huge profits from a global memory shortage, has offered to pay generous bonuses to staff, but it wants to give 27,000 memory chip employees at least six times more than its other workers in its logic chip design and manufacturing businesses.
The union argues that the firm's other 23,000 workers, responsible for making AI chips for Tesla's and Nvidia's, should not be left behind, despite suffering billions in losses in recent years as the foundry business floundered. The strike could impact Samsung's operating profit by 21 trillion to 31 trillion won, while sales losses could stand at about 4.5 trillion won.
The issues are partly self-inflicted by the company, as Samsung's move to put different businesses together created a complex business structure that results in a valuation discount while causing conflicts of interest and limiting business opportunities. The discontent among Samsung workers grew last year after rival SK Hynix abolished its bonus pay cap for 10 years, leading to bonuses more than three times higher than those offered to Samsung workers.
The union's demands include requests for Samsung to abolish a bonus cap of 50 per cent of annual salaries and allocate 15 per cent of annual operating profit to a bonus pool distributed to workers
Samsung Electronics Strike Bonus Payouts AI Boom Memory Chips AI Data Centers Smartphones Laptops Global Supply Chains Valuation Discount Complex Business Structure Conflicts Of Interest Foundry Business Logic Chip Design Memory Unit AI Chips Rival SK Hynix Bonus Pay Cap Allocation Of 15 Per Cent Of Annual Operating Discontent Among Samsung Workers Complex Business Structure Conflicts Of Interest Foundry Business Logic Chip Design Memory Unit AI Chips Rival SK Hynix Bonus Pay Cap Allocation Of 15 Per Cent Of Annual Operating
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