Lean Production Systems, Labor Unions, and Greenfield Locations of the Korean New Auto Assembly Plants and Their Suppliers

Abstract

This article investigates why Korean auto assembly firms introduced “lean production systems” and chose greenfield locations as their new flexible production sites in the 1990s. I show that labor unions are important actors that directly affect firms‘ adoption and location strategies for lean production systems, by means of an analysis of Korean auto firms‘ managerial and locational strategies in response to adversarial labor relations. Korean firms‘ choice of greenfield locations for implementing lean production systems indicates that their desire to procure a malleable labor force is more important than proximity. Korean auto firms‘ decisions to implement Japanese‐style lean production systems and their choice of greenfield locations reflect conflicts between workers and managers. The findings in this article critique the existing literature in economic geography, which is devoid of discussions of workers and labor unions as active geographic agents, from the labor geography point of view.

The Limitations of Global Social Movement Unionism as an Emancipatory Labour Strategy in Majority World Countries

“…The whole society still carries out the old traditions of loyalty, authority and rigid hierarchical relationships where a poor worker has very little scope to talk face-to-face with his employer or with the state agencies. This observation lines up with the finding of two recent studies that employers and the state apparatuses never show any interest in workers' conditions until they feel strong pressure from the working class organizations (Petras 2002;Lee 2003). The question we raise, then, is whether labour unions in majority world countries should be committing limited resources to furthering democratic dialogue when militant collective mobilization is what gets results?…”

Economic Institutions and the Location Strategies of European Multinationals in their Geographic Neighborhood

“…Therefore, beyond the conventional belief and weak evidence that more rigid labor markets represent a cost for foreign investors, it is possible to argue that countries with different labor market regulations attract different types of foreign investment. For instance, Lee (2003) suggests that the existence of labor unions positively affects firms' greenfield location of new plants in the Korean automotive industry.…”

China's Dynamic Industrial Sector: The Automobile Industry

“…Indeed, the post-World War II period has witnessed only two successful cases of the development of a domestic automobile industry: Japan and South Korea. In fact, the rise of these Japanese and Korean automobile TNCs was a major force driving the restructuring and spatial change of the world automobile industry in the second half of the 20 th century (e.g., Mair et al, 1988;Womack et al, 1990;Jones and North, 1991;Sadler, 1994;Lee, 2003;Park, 2003;Sturgeon et al, 2008). Meanwhile, other latecomer countries by and large depend on foreign TNCs in developing their automobile production (e.g., Jenkins, 1977;Tuman and Morris, 1999;Pavlínek, 2002;Coe et al, 2004;Depner and Bathelt, 2005), whereas some traditional automobile-producing countries have lost their national output to TNCs (e.g., Church, 1994;Lagendijk, 1995;Barnes and Kaplinsky, 2000;Boschma and Wenting, 2007).…”