South Korea Gets Aggressive With EV Incentives, Infrastructure

South Korea is now the fifth largest auto manufacturing company in the world. Its domestic automakers produced 1.8 million vehicles in the first 5 months of 2016. Over 60% of them were exported to foreign markets. Korea’s two largest manufacturers, Hyundai and Kia, make many hybrid and EV cars, but sell few of them domestically. The Korean public has little interest in such cars.

“The lack of domestic e-car infrastructure has been an impediment to e-car development and production in South Korea, but that will change from now,” Lee Won-joo, director of the Automobile Aerospace Division, told Bloomberg Business News Asia. That may soon change. South Korea is about to embark on an aggressive push to make electric and plug-in cars more palatable to local customers.

The plan includes development of an EV battery with energy density high enough to more than double the travel distance on a charge to 400 kilometers or nearly 250 miles. By 2020, high speed charging stations will become available at an average of one within a two-kilometer radius in the capital city of Seoul, with a population of 10 million. In addition, 30,000 slow charging stations will be strategically located at about 4,000 apartment complexes nationwide by 2020.

EV buyers will get other inducements, too. Starting this year, the tax paid at the time of purchasing an EV will be reduced. Drivers will also see cuts in insurance premiums, expressway tolls, and parking fees. The standard one time government subsidy available to EV buyers was increased to $12,100 from $10,400 as of July 8.

According to Global EV Outlook 2016 released by the International Energy Agency, market share for EVs in South Korea was a paltry 0.2% in 2015. That makes it among the lowest in comparison with 15 other members of the Electric Vehicles Initiative international governmental forum. The government estimates that the current and future policy programs will help increase the EV market share in South Korea to 0.5%in 2017 and 5.3% in 2020.

Cars manufactured in South Korea account for 8.5% of the global market. The government would like for Korean made EV sales to equal 8.5% of the global market for plug-in hybrid and electric cars within a few years. Both Hyundai and Kia are about to introduce hybrid, plug-in hybrid versions of their latest cars to global customers later this year.

Volkswagen Investing $10,000,000 In EV Infrastructure

Volkswagen is investing $10,000,000 of its own money to develop EV infrastructure for its electric and plug in cars. That includes its recent agreement with BMW and ChargePoint to provide a network of DC fast chargers along both coasts. But it says federal, state and local governments should be doing more to help.

Jörg Sommer, VW’s vice president for product marketing and strategy in America told the 2015 Electric Drive Congress in Washington D.C. on February 10, that Volkswagen believes continued legislative support is needed to reach the next level of electric vehicle adoption.

“Automakers have effectively delivered electric vehicles that can satisfy the needs of most American drivers,” said Sommer. “In addition to the investment we and other companies and industries are making, we would like to see Federal financing support for establishing fast charging networks in urban areas and interstate corridors. We’d like to see more state and federal organizations commit to cleaner fleets by purchasing EVs and PHEVs. This should be a U.S. Government priority, and federal purchasing guidelines should reflect that by giving fleet purchasers the flexibility they need,” Sommer said. “We need further congressional support with the mid-term review of the EPA’s greenhouse gas regulation to extend the multiplier credits for plug-in vehicles beyond MY21″.

Sommers’ comments raise the thorny political question of who should pay for the buildout of EV charger infrastructure. Tesla has taken on the entire burden of creating its SuperCharger network without government aid, and it’s been pretty much universally celebrated for being both fast AND free. As far as anyone knows, every manufacturer is losing money on the electric cars it builds. No one can expect the car makers to go on subsidizing the infrastructure push forever. You can’t buy apples for 50 cents a piece if you can only sell them three for a dollar and expect to make up the difference in volume.