This photo provided by the Fair Trade Commission (FTC) on Jan. 3, 2023, shows an advertisement of the South Korean arm of U.S. electric vehicle giant Tesla Inc. in 2019.
SEOUL, Jan. 3 (Korea Bizwire) — South Korea’s antitrust regulator said Tuesday it has decided to impose a penalty of 2.85 billion won (US$2.24 million) on U.S. electric carmaker Tesla Inc. and its South Korean unit for misleading advertisements.
The move came as Tesla released advertisements in August 2019, which suggested its electric car can “run at least” hundreds of kilometers, which the Fair Trade Commission (FTC) considered to be an “exaggeration.”
“The distance mentioned in the advertisements is only possible under an average temperature and in downtown areas. Under other conditions, the distance is shorter,” the FTC said. “The actual range fell up to 50.5 percent under colder temperatures.”
The FTC also pointed out that the U.S. carmaker used expressions such as “up to 326 miles” in its advertisements at home.
Tesla provided false information considering its automobiles’ charging speed as well.
“Without mentioning types and test conditions, (Tesla) advertised that its superchargers can charge automobiles enough to run hundreds of kilometers in 15 or 30 minutes,” the regulator said.
“The test result was based on optimized conditions with high charging efficiency,” the regulator said, adding that such performances cannot be achieved under ordinary conditions.
The FTC added that while Tesla advertised the performance of the V3 model of its Supercharger in 2019, the company installed them locally only after March 2021.
The FTC also decided to slap a separate fine of 1 million won on Tesla for its unfair business practices.
The move was in response to Tesla receiving commissions of 100,000 won for every order for around a year starting in January 2020, without refunding them if consumers canceled their purchases.
Tesla violated South Korea’s rules by not allowing buyers to cancel their orders online as well while requiring them to make phone calls, the regulator said.
Tesla accounted for 43.3 percent of the local electric vehicle market in the first half of 2020, according to the data compiled by the FTC. Hyundai Motor Co. and Kia Corp. followed with 29.8 percent and 14.1 percent, respectively.
(Yonhap)
