Toyota calls union pay demands impossible; talks outcome key for Abenomics

Wed Feb 25, 2015 2:38am EST
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Maki Shiraki and Chang-Ran Kim

TOYOTA CITY/TOKYO (Reuters) - Toyota Motor Corp (7203.T: Quote) said on Wednesday it was "impossible" to meet union demands for a 13,300 yen ($112) monthly pay rise, as the automaker concluded the first day of labor talks widely considered crucial for Japan's economic recovery.

The outcome of annual pay talks at Toyota is often seen as a bellwether for other companies. A favorable result for the union is therefore critical for Prime Minister Shinzo Abe's goal of creating a virtuous cycle of higher wages, bigger consumer spending and economic growth.

Toyota's management will finalize its response on March 18.

Workers at Japan's eight automakers are all seeking base wage hikes of 6,000 yen - about two to three times more than the additional pay they received last year. Toyota's workers want another 7,300 yen on top of that in seniority-related raises and a one-off bonus equivalent to 6.8 months' worth of salary.

"The request was far higher than what we had expected, so we conveyed to them that ... it was totally impossible to meet the demands in full," Tatsuro Ueda, managing officer in charge of human resources, told reporters at Toyota's headquarters.

The wage hike, equivalent to a 3.7 percent raise, plus bonus and other perks would add 20 billion yen ($168.36 million) to annual costs, Toyota said.

ABENOMICS BENEFICIARY   Continued...

 
A Toyota car is seen during a presentation of the car maker's active safety support systems technology in Tokyo, November 26, 2014.  REUTERS/Thomas Peter