A strike at a Japanese car parts supplier in southern China forced Toyota Motor Corp to suspend production at a Chinese auto assembly plant, the latest in a string of labor-related disruptions at foreign-owned manufacturers across the country.
Work at the Toyota factory, which has an annual capacity of 360,000 units and makes models such as the Camry and Yaris, had been suspended since Tuesday morning, Toyota spokeswoman Ririko Takeuchi said.
The car parts supplier, Denso (Guangzhou Nansha) Co Ltd, is owned by Japan's Denso Corp, and is affiliated with Toyota Motor Corp.
Employees were asking that wages rise from between 1,100 and 1,300 yuan ($161-191) per month to between 1,800 and 1,900 yuan, a worker at the plant said.
"We make an okay living here, but we think our pay should be linked to the company's performance," said the employee, who declined to give his name out of fear of retribution. "This company makes lots of money and should share the profits."
Management of the Denso-owned plant was negotiating with workers over their demands for higher wages and better benefits, Denso spokeswoman Yoko Suga said. The company has about 1,100 employees.
The employee said the work stoppage would continue for the rest of the week.
"There is no decision yet on when production will resume," Toyota's Takeuchi said.
Tricky challenge to ruling party
The strike at the Denso plant, located in China's booming Guangdong province, is the most recent in a series of Chinese labor actions that present a tricky challenge for China's ruling Communist Party, which has vowed to improve incomes but is jittery about protests.
The Denso plant supplies fuel injection equipment and other products to clients such as Toyota and Honda Motor Co and has stopped shipping parts since Monday, Suga said.
China-based Honda spokesman Takayuki Fujii said if the production stoppage continued at Denso, parts supplies for Honda's car factories could also run out.
In recent weeks, strikes have broken out at a supplier of locks to Honda, a Toyota Gosei plant which makes parts for Toyota, and Chongqing Brewery Co Ltd., among others. All have since been resolved.
Management of the Denso-owned plant was negotiating with workers over demands for higher wages and better benefits, said Suga. The company has about 1,100 employees.
Inside the gates of the car parts plant on Tuesday, several hundred workers stood in front of a warehouse to listen to Zeng Qinghong, a member of the National People's Congress and vice chairman of Honda joint venture partner Guangzhou Automobile Group, and government union representatives urge them to return to work immediately.
Security guards and plainclothes policemen stood in front of the factory gates.
China's leaders, who are obsessed with maintaining social stability but also say they can ensure a better life for those at the bottom end of an expanding rich-poor gap, have muted coverage of labor disputes by state media while expressing public support for workers.
Worker demands test for stability
The nation's official trade union warned in a report that worker demands were a test for stability, as China's young rural migrant workers expect improved incomes and rights while they struggle for a foothold in urban society.
The report by the All-China Federation of Trade Unions did not mention the recent outburst of factory strikes initiated by migrant workers demanding higher wages. Yet the study shows that the rising demands of a new generation of workers migrating from Chinese villages are weighing on policymakers.
"The accumulation of these demands and problems has begun to have a negative effect on our country's political and social stability and sustainable economic development," the Chinese-language report said of China's young rural migrants.
It was reported by Chinese media on Tuesday, after appearing on Monday on the trade union federation's website (www.acftu.org) and in its official newspaper, the Workers' Daily.
China's official trade unions come under the control of the ruling Communist Party and rarely support strikes or confrontations with employers. Many private companies do not have unions, or if they do they are controlled by management.
Some union officials have been pressing for more vocal representation of workers, including migrants.