Toyota Motor Corp. and Honda Motor Co. agreed Wednesday to fully meet the salary and bonus demands put forward by their respective labor unions, with the proactive stance by the two major Japanese automakers expected to generate momentum for wage hikes in other sectors.
The decision by Toyota marks the third year it has fully met wage hike demands in the so-called shunto spring negotiations between unions and management. The union of the top automaker has called for the highest-level wage raise in 20 years to offset the impact of high inflation.
Meanwhile, Honda said it will meet its union's demands of a 19,000 yen ($141) increase in total monthly pay, including a 12,500 yen rise in the basic pay scale, both the highest in 30 years, as well as an annual bonus worth 6.4 months of pay.
The move reflects the eagerness of the automakers' management to secure high-level human resources through the wage hikes amid intensifying competition in the face of next-generation technologies such as electric vehicles and self-driving cars.
Toyota's incoming president Koji Sato told the union he would fully meet its demands, which included an annual bonus totaling 6.7 months of pay, according to sources familiar with the matter.
The automotive industry's wage talks have been closely watched as they have a strong influence on other sectors. The new business year for automakers and many other major companies in Japan begins in April.
