SEOUL, Jan. 20 (Korea Bizwire) — South Korea announced plans on Wednesday to reduce the amount of subsidies provided to electric vehicle (EV) purchases in exchange for offering subsidies to a wider line-up.
The government said that subsidies will be provided to 207,500 EVs this year, up from 101,000 cars last year. The maximum amount of subsidies provided for the purchase of each car, however, will drop from 8 million won (US$6,710) to 7 million won.
Additional subsidies provided by provincial governments, in turn, are expected to drop slightly from the 4 to 5 million won hurdle.
Only EVs that cost less than 55 million won will be eligible for a full subsidy, which is a slight drop from last year’s 60 million won limit.
EVs that cost between 55 million and 85 million won will be eligible for a 50 percent subsidy, which is also a drop from last year’s 60 to 90 million won limit.
EVs that cost more than 85 million won will not be eligible for any subsidy.
This policy change is expected to alter the amount of subsidies provided for each EV model, based on their unit price.
Hyundai Motor Co.’s IONIQ 5 all-electric model and Kia Corp.’s all-electric EV6 sedan will be eligible for a full subsidy for all of their trims.
However, the GV60, the first dedicated EV of Hyundai Motor Group’s luxury Genesis brand released in October of last year, costs 59.9 million won (2WD model) and is now only eligible for a 50 percent subsidy rather than a full one.
U.S. EV maker Tesla Inc.’s models, which recently saw their prices jump, are expected to be eligible for smaller subsidies or none at all.
Kevin Lee (email@example.com)