Green car incentives are in place in Korea – but do they go far enough?
If a person buys a hybrid car in Korea starting next month, the buyer will benefit from up to 3.1million won ($2,472) in acquisition and registration tax breaks as the government bids to make Korea a leading green country. Drivers will benefit whether they pick up one of the locally made vehicles such as Hyundai’s Avante LPI or Kia’s Forte Hybrid – or whether they purchase a hybrid car from overseas manufacturers such as Toyota and Honda.
However, analysts have criticised the size of the green car support and state it is small compared to the incentives provided in France, Japan and the USA.
Kang Cheol-gu, an executive of the Korea Automobile Manufacturers Association, says the subsidy is insufficient. He compares it to Japan offering 250,000 yen ($2,544) to purchasers of hybrid cars as well as cutting acquisition taxes for green cars whether they have hybrid or clean diesel engines. Furthermore, subsidies offered in Japan for next generation green cars such as the Mitsubishi i-MiEV go even further with reductions available up to $32,572.
Head of the Korean Academy of Motor Industry Kim Ki-Chan hopes that the government “will come up with more active policies” – for example, critics believe the Government should include clean diesel cars in its definition of green cars. Currently, Korea only includes hybrids, electrics and fuel cells in its green car definition.
The Ministry of Knowledge Economy will debate the issue soon.
