Strike hits Samsung production at key electronics plant in Tamil Nadu

Senior executives from Samsung are working to address this unusual instance of labour unrest, according to reports.

Samsung, headquartered in South Korea, is India's largest consumer electronics firm and considers the country a vital growth market, competing with rivals like LG Electronics across various product categories, including televisions, refrigerators, and smartphones.

The plant in Tamil Nadu's Sriperumbudur, one of Samsung’s two factories in India, employs about 1,800 people and produces electronic products rather than smartphones.

Despite this, the plant accounts for 20 to 30 percent of Samsung's annual $12 billion revenue in India, Reuters reported, citing two sources familiar with the situation who requested anonymity.

Workers have set up tents outside the plant at Sriperumbudur, barely 40 km from Tamil Nadu's capital Chennai, displaying "Indefinite Strike" posters, and are demanding higher wages, improved working hours, and recognition of a union affiliated with the Centre of Indian Trade Unions group.

Union leader E. Muthukumar confirmed that the strike had entered into the third consecutive day on Wednesday (Sept. 11), reports Reuters.

The strike has impacted about half of the factory’s daily output, with many workers participating in the protest.

Meanwhile, Samsung's shares fell 1.9 percent in Seoul, while the KOSPI index dropped by 0.5 percent, as per reports.

Samsung’s Southwest Asia CEO, JB Park, along with other senior executives, are visiting the plant to seek a resolution, Reuters reported.

JB Park, who manages Samsung’s India market from Gurugram near New Delhi, has reportedly been actively involved in the discussions.

However, Samsung did not provide a comment when requested, and Muthukumar stated that no agreement had been reached as of Tuesday, according to Reuters.

Tamil Nadu labour secretary Veera Raghava Rao told Reuters that talks between workers and management were ongoing, but there was no clear timeline for when the issue might be resolved.

Samsung India stated on Monday that it is actively engaging with workers to address grievances and comply with all relevant laws and regulations, Reuters reported.

Approximately 800 workers signed a register outside the factory to document their protest, reports said.

Reuters reported, quoting Prabhu Ram, a vice president at Cybermedia Research, that the strike could hinder Samsung's production efforts ahead of the important sales as festival season in India is approaching.

In South Korea, Samsung Electronics' largest worker union, comprising 36,500 members, also went on strike in July and August demanding better wages and benefits, according to a Reuters report.

However, Samsung reported that this action did not disrupt production.

In India, Samsung workers are calling for equal pay for employees with similar experience levels.

Their demands have received support from some Indian political leaders who participated in Tuesday's protest, as per reports.