SEOUL, Sept 4 (Reuters) Hyundai Motor Co. has reached a tentative wage deal for this year with its

SEOUL, Sept 4 (Reuters) Hyundai Motor Co. has reached a tentative wage deal for this year with its unionised workforce, the first time in 10 years that South Korea's top auto maker has agreed a salary package without a strike.

The deal, which needs approval by the union's members, includes a 5.8 percent rise in base salary and a one-off payment of 2 million won ($1,921) each, along with an increase in bonuses.

That compares with last year's 5.1 percent base rise and 1 million won bonus per employee.

Poor labour relations are considered a big hurdle to Hyundai's goal, along with affiliate Kia Motors Corp, of becoming the world's fifth-largest volume automaker by 2010. It is currently ranked sixth.

''This breakthrough marks a new beginning for Hyundai's labour-management relationship and a clear indication of mutual cooperation,'' Hyundai's spokesman Jake Jang said by telephone.

The improvement in labour relations is expected to help Hyundai boost its brand images and competitiveness in the global auto market by increasing productivity and efficiency, he added.

The union plans to vote on the agreement on Thursday, the company said.

Earlier this year the union stopped work for a total of 13 days, demanding a bigger bonus and in protest at a U.S.-South Korea free trade agreement, which were separate from the annual wage negotiations.

The labour action cost the company 336.1 billion won ($358.6 million) in lost output, which is just over 20 percent of last year's 1.59 trillion won of lost production due to strikes, Hyundai said.

Before the agreement, shares in Hyundai ended up 0.28 percent at 70,900 won on Seoul's main stock market, outperforming a 0.38 percent fall in the benchmark KOSPI.

Separately, Hyundai will spend 137.5 billion won in building a new engine plant in its main production base in Ulsan, southeast of Seoul, according to its disclosure to the Korea Exchange on Tuesday.

REUTERS DKS BD1808