Around 40,000 Samsung Electronics workers rallied on Thursday, demanding a larger share of the company's booming profits. Unions warned they could launch an 18-day strike if demands are not met, potentially disrupting production of chips crucial for the growing AI industry.

The unions are calling for the removal of the bonus cap, currently set at 50% of annual base salary. They argue that a chip division employee earning 76 million won ($51,000) would receive a 2025 bonus of 38 million won ($26,000) – less than a third of what a comparable worker at rival SK Hynix would receive.

Samsung has rejected the demand to scrap the cap but says it will provide additional funding to ensure memory chip workers earn more than competitors this year. Negotiations are ongoing.

If talks fail, the strike is set to begin on May 21. Unions claim a production halt could cost the company over 1 trillion won ($700 million) per day. Samsung officials warn that even a short disruption could damage customer trust and take years to recover.

Samsung and SK Hynix together produce about two-thirds of the world's memory chips. SK Hynix overtook Samsung as Nvidia's main supplier of high-bandwidth memory (HBM) chips after ChatGPT launched in 2022.

Samsung, long known for resisting unions, experienced its first-ever worker strike in 2024. The Middle East conflict has also complicated supply chains, restricting access to key materials like helium and pushing up energy costs.

Source: www.dw.com