Governmental Support
Competition in the electric vehicle (EV) market is becoming increasingly fierce, with the central and local governments expanding their policy for the popularization of EVs and automakers cutting the prices of their EVs and providing more customer incentives.
Renault Samsung Motors recently cut the price of the SM3 Z.E. by 1.48 million won (US$1,350) to 41.9 million won (US$38,240) and GM Korea marked down that of the Spark EV by 1.5 million won (US$1,369) to 38.4 million won (US$35,057). Kia Motors provides a discount of about 1 million won (US$913), depending on the installment plan, for those who purchase the Soul EV, and BMW guarantees 52 percent of the car price for three years for those buying the i3. Hyundai Motor Company is planning to release an EV next year.
The aggressive marketing campaigns have to do with local government policy. For example, Seoul City and Jeju Province provide financial assistance for EV buyer by lot. The Ministry of Environment gives a grant of 15 million won (US$13,689) per vehicle, and this results in savings of close to 20 million won (US$18,261) when subsidies from the local governments are added.
This year, the central and local governments are planning to supply a total of 3,090 EVs. The Ministry of Environment is aiming to increase the number by 10,000 next year. To this end, the ministry has asked the Ministry of Strategy and Finance to allow a budget of 150 billion won (US$136.9 million).