With the stalemate in labour negotiations, the samsung electronics union is planning to officially launch an 18-day comprehensive strike on 21 may。
The operation, which is expected to involve more than 45,000 union members, is likely to exceed 50,000, representing 64 per cent of the total number of employees in the tristar semiconductor sector (ds). Once implemented on schedule, this will be the largest strike in the world's semiconductor industry's history, and its reach and potential losses will be far greater than any previous industry shutdown。
As a key hub in the global semiconductor industry chain, samsung operates at depths that bind leading firms such as weyida and tesla, and is an irreplaceable core supplier in the global ai computing supply chain。
In the context of the current acceleration of global ai construction and the intensive expansion of data centres, once this 18-day nightmare is realized, it will have a triple impact on samsung, the korean economy and the global semiconductor supply chain, with a chain reaction or continuation for months。
I. Three stars: a huge shock to performance and a serious challenge to market position
In retrospect, the samsung trade union actually launched a 25-day strike in july 2024, although the number of participants at that time was only about 5,000, with limited impact on overall capacity and global supply chains。
However, less than two years later, the strike has dramatically increased to almost 10 times the scale of the previous strike, from local protests to collective action to create the core of the semiconductor, with a different nature from the level of impact。
A number of industry observers stated that this was one of the most serious lockout risks in the history of the global chip industry。
In april this year, samsung also had a single-day strike, which had revealed in advance the enormous cost of the semiconductor sector being shut down. The data show a sharp drop of 58 per cent in the production of the crystal round generation and a decline of 8 per cent in the production of storage。
Of particular note is the high degree of continuity in the production of semiconductors, which requires a 24-hour uninterrupted operation of the production line, and once it has been stopped, all of the delivered crystals will be scrapped as a result of the interruption of the process - with a single piece of crystals valued at as much as $20,000。
According to industry estimates, if this 18-day strike breaks out, samsung is most likely to be cut off in stages, and the three- to four-month-long crystal round under the conventional dram process, as well as the hbm high-bandwidth memory, will suddenly become waste, with direct economic losses estimated at between 30 trillion and 10 trillion won (approximately 1353 billion yuan and 451 billion yuan). To this end, samsung has initiated the production of “temperature” measures ahead of schedule and has proactively reduced the new crystal-turner delivery to reduce potential losses。
At the business level, the impact of the strike on the profits of samsung cannot be underestimated。
Morgan chase analysts estimated that if the samsung union were to stop production for 18 days, it would result in an income loss of more than 4 trillion won (approximately 18 billion yuan) for samsung, which in extreme cases could even increase to between $14 billion and $20,790 million; and if union claims were fully met, an increase in the cost of labour alone would result in a 7 to 12 per cent decline in the profits of samsung in 2026。
In addition to direct loss of crystal-turned material and loss of revenue, the reputation of the samsung enterprise will be damaged。
In recent quarters, samsung has just made breakthroughs in the high-end memory market, and the arrival of this strike will undoubtedly pose a direct threat to this recovery momentum and will lead to a significant increase in the risk of delays in the delivery of high-end orders and damage to client trust。
The chairman of the samsung board has recently stated in his internal statements that strikes can lead to loss of clients, a decline in competitiveness and even a destabilization of long-established market leadership positions of companies。
For korea: slowing economic growth, capital market pressures
For the korean economy, the samsung strike was more than one-sided。
On sunday local time, korean prime minister kim min-sik stated that samsung's position in the korean economy was significant, accounting for 22. 8 per cent of south korean exports, 26 per cent of the market value of domestic stock markets, employing more than 120,000 employees and trading with 1,700 suppliers. The damage to the korean economy will be devastating once the strike has taken place。
In its analysis, the bank of korea further warned that an 18-day comprehensive strike could lead to a 0. 5 percentage point drop in south korea's economic growth rate in 2026, falling back from the 2 per cent forecast to 1 per cent. Even after the strike, it will take two to three weeks for production lines to be restarted and rates restored, and the subsequent effects will continue to ferment。
South korean president lee had previously publicly expressed concern about the situation, and there was general agreement in the market that the strike had risen from corporate labour disputes to major events affecting the country's economic stability。
The six major economic organizations in korea have recently issued a joint statement warning that due to the special nature of the semiconductor process, the impact of the samsung strike could increase exponentially. The six organizations warned:
“in view of the 24-hour uninterrupted operation of the semiconductor process, the strike led to the suspension of the production line, which could result in a large number of crystals being scrapped, damage to equipment and even major safety incidents such as chemical spills.”
They added: “this would result in significant losses, including a decline in global supply chain confidence, loss of clients and a decrease in national credit ratings.”
They also warned that samsung strike would impact on korean capital markets: “ samsung electronics is the company with the highest market value of korea's integrated stock price index (kospi), accounting for 25 per cent of the total market value of kospi, and the damage caused by the strike will lead to a decline in the overall kospi index and an accelerated withdrawal of foreign investors, thereby significantly shrinking domestic capital markets in korea.”
The korean american chamber of commerce also noted that the uncertainty in the labour market resulting from the strike would undermine the country's reputation as a reliable partner in global manufacturing and might in the long run prompt global customers to reassess supply chain layout strategies。
Iii. Global: chip supply chains fractured and the ai infrastructure rhythm will be affected
Looking at the global market, the spillover effect of the samsung strike will extend throughout the semiconductor and ai industrial chain。
Chase morgan predicted that the event would result in a 0. 5-0. 9 per cent decline in triplestar dram and nand flash production during the year; kb securities estimated that, if the samsung production stopped for 18 days, there would be a 3-4 per cent gap in global dram supply, and a 2-3 per cent gap in nand supply, with an impact scale of 2-3 per cent equal to the current global fifth-largest dram manufacturer, south asia, exit。
The current global memory market is short of demand, and any contraction in supply can quickly trigger market panic, push chip prices and stretch delivery cycles。
Specifically, a strike by samsung could lead to a disruption of the gpu delivery pace, delays in the construction of the global ai data centre and increased upward pressure on the cost of servers and terminal electronic equipment。
Even more critical is the fact that competitions like sk hercules and u. S. S. A. Will not be able to fill the three-star production capacity gap in the short term, and the vulnerability of the global semiconductor supply chain, which is over-reliant on a single manufacturer, will be fully exposed。
To date, samsung electronics and trade unions have been conducting final negotiations under the mediation of the korea industrial board, but the trade union side has shown a strong attitude and, if the negotiations have not been successful, the 18-day strike is scheduled to begin on 21 may。
Market parties are closely following the progress of the negotiations and, if they break down, a storm will engulf the global semiconductor industry, impact the foundations of the south korean economy, or will officially open the curtain。
