SEOUL, April 12 (Korea Bizwire) — In a move to address a lack of approved transportation vehicles in South Korea’s voraciously expanding package delivery industry, the government will introduce a permit for “smaller” vehicles weighing under 1.5 tons starting next month.
As permits for operating a package delivery vehicle were previously limited, delivery professionals unable to acquire one resorted to making their runs illicitly in their own unsanctioned vehicles.
The number of individuals apprehended by the authorities for making use of illegal vehicles has risen in the past three years, from 407 in 2015 to 762 last year.
The lack of vehicles is an industry problem that has already been addressed by the government; from 2013 through 2016, 24,000 package delivery vehicles were approved, but this proved to be insufficient.
By the end of 2016, 28,560 package delivery vehicles were in operation, 11,391 vehicles short of actual demand, according to research conducted by the Korea Transport Institute.
Going forward, the Ministry of Land, Infrastructure and Transport will extend package delivery vehicle permits to delivery professionals under an exclusive contract with firms recognized by the government.
The average South Korean uses a package delivery service 47 times per year. With a yearly increase in volume of goods transported above 10 percent, as of last year approximately 2.3 billion items were handled, and revenues hit 5.2 trillion won.
The industry’s year-on-year growth rate every four years from 2004 to 2016 was 17.9 percent (2004), 16.9 percent (2008), 8.2 percent (2012) and 12.7 percent (2016).