Hyundai, Kia production disrupted due to strike at supplier

SEOUL, May 22 (Reuters): South Korea's Hyundai Motor and its affiliate Kia Motors said Sunday that they suffered from a production disruption of some of its SUV models after a labour strike at one of its suppliers led to a parts shortage. Hyundai, the world's fifth-biggest carmaker along with Kia Motors , warned that a protracted supply disruption could deal a blow at a time when Japanese rivals are all-out to resume production after the March 11 earthquake. The parts supplier, Yoosung Enterprise Co, Ltd , stopped production from May 18, after labor members occupied production lines over disagreements on new wage and shift systems, Hyundai said in a statement. Yoosung provides key engine parts to Hyundai, Kia, the Korean units of General Motors, Renault SA and Ssangyong Motor . Around 70 percent of the piston rings used in popular models produced by the two firms such as Sonata sedan, Santa Fe SUV, the K5 sedan and Sportage R SUVs come from the supplier. The supply woe crippled the production of Hyundai's SUVs such as Tucson ix, Santa Fe and Veracruz at an Ulsan plant from Sunday and the production of Kia's Carnival SUV at the automaker's Sohari plant from Friday. "Our engine inventory will start to dry up on May 24, after which a production disruption will be inevitable for all of our passenger and commercial vehicles except for some small models...," Hyundai said in a statement.