Yulon Motor to freeze pay raises for '12: report
The China Post news staff
July 19, 2012, 11:03 am TWN
The management of Yulon Motor has decided not to raise employees' pay this year, due to slowed business in the auto market, a report said yesterday. The decision, made by Yulon's five-person administrative team, sent shockwaves throughout the industry, as Yulon had always been generous in paying its employees. Besides Yulon, other companies in the traditional sectors have also announced pay raise freeze or even pay reduction measures, indicating these enterprises are growingly downbeat about the second half. The paper cited high-level Yulon officials as saying the reason for the pay raise freeze was a mere 1.47-percent year-on-year increase of the consumer price index in the first half, which was less than the threshold for the pay raise last year. Yet the move still took employees and the industry by surprise, as Kenneth Yen, chief executive of the Yulon Group, had only in the beginning of the year touted the pay raise measure launched by Terry Gou, chairman of the Hon Hai Group, and said Yulon should follow suit. The salary raise freeze also came at an untimely moment, given Yulon is scheduled to launch the first sedan under the Luxgen brand in August, which is a huge undertaking. According to experts, the auto industry has been slow. Many dealers had to resort to discounts and promotional campaigns to keep first-half business at the same level as last year.