On May 13, according to CNBC, the market value of Samsung Electronics, South Korea’s largest company, evaporated by 99.07 trillion won (approximately $66.18 billion) on Wednesday because Samsung and the union failed to reach an agreement on wages. However, Samsung recovered this loss in market value after senior South Korean government officials intervened to calm strike concerns.
Note: Samsung faces strike threat
In intraday trading on the South Korean stock market on Wednesday, Samsung's stock price fell 6.09% from Tuesday's closing price of 279,000 won. Previously, Samsung's labor union threatened to hold an 18-day strike starting on May 21 if its demands were not met. It is expected that more than 41,000 workers will participate in the strike.
Samsung's labor union said their rally on April 23 attracted 40,000 workers, causing Samsung's wafer foundry output to drop by 58% and memory chip output to drop by 18% that day. The union also added that the 18-day strike could cause Samsung 30 trillion won (about 20 billion U.S. dollars) in losses.
However, the Korean government intervened in this labor dispute. South Korea's Finance Minister Koo Yun Cheol posted on X that the government "deeply regrets" the failure of labor and management to reach an agreement and warned that "a strike must not occur under any circumstances."
"Samsung Electronics is an important company that has attracted worldwide attention," Koo Yoon-cheol wrote. "Considering the current management situation and its impact on the national economy, both labor and management must continue to work hard and conduct principled negotiations."
Meanwhile, South Korean Prime Minister Kim Min Seok has instructed the government to "closely control the situation" and provide "active assistance" to avoid strikes.
After Koo Yoon-cheol and Kim Min-seok expressed their opinions, Samsung's stock price subsequently reversed its decline and turned upward. As of press time, Samsung's stock price has risen less than 1%.