SEOUL, Nov. 17 (Korea Bizwire) – Electric vehicles (EVs) are expected to get wider distribution through rental and car sharing services, bolstered by a government-industry agreement, auto business officials said Thursday.
The Environment Ministry and car rental companies struck a pact Wednesday to promote the use of eco-friendly vehicles. The rental firms will provide contracts to lend more than 6,000 EVs a year, while the ministry will offer monetary incentives to buyers of rental cars. Officials said the agreement would make long-term EV rentals up to 2.5 million won (US$2,129) cheaper than purchasing an EV.
EVs have been mostly rented for short-term use in Jeju, a southern island designated as the first hub for the vehicles. Officials say the plan is to make the cars more available for long-time use to help their distribution.
Lotte Rental is the front-runner in the EV rental business, currently operating 250 vehicles ranging from the Ioniq of Hyundai, the i3 from BMW, the SME ZE from Renault Samsung and theBolt from GM Korea. The company said it will increase its stock of EVs to 300 by the end of the year.
SK Rental Car has a 30 EV rental service in Jeju. It launched a long-term rental package in March.
Consumer appraisals for the EVs have been positive. According to Lotte Rental, 92 percent of the people who used the short-term service for EVs said they were satisfied. Another 83 percent said they were willing to rent EVs again.
Among younger drivers, the car sharing was the more popular form of use. Demand for EVs for car sharing at Lotte Rental and Green Car, another auto rental company, were 1.5 times higher than for gasoline-driven vehicles.
In case of Green Car, the average rental for an Ioniq EV in Jeju was 23.5 hours for 111 kilometers, way more than 6.8 hours and 68 kilometers for the popular brand Avante’s gasoline cars.
Officials said that with the agreement Wednesday, about 4 percent of the 150,000-vehicle annual rental car market will be replaced by EVs.
“Promotion of EVs as eco-friendly cars is a global issue and a megatrend that will overhaul the conventional energy paradigm and cannot be retracted,” said Pyo Hyun-myung, CEO of Lotte Rental. “The government-industry agreement will serve as a good example in activating the EV market at home.”