The U.S electric vehicle maker Tesla is currently enjoying a solid momentum in South Korea. However, it looks like its efforts could backfire because of a recent announcement from the government. Over the weekend, the South Korea government announced that it intends to recalibrate its subsidy program for electric vehicles, which could remove Tesla from its generous incentives.
South Korea's EV Subsidy Program
The latest information about the South Korea government's decision was reported by the Korea Herald. According to the site, the government announced on Sunday that it wants to recheck the country's subsidy program for electric vehicles. The report mentioned that almost half of the country's grants during the January to June period were given to premium Tesla vehicles.
The possible revision of the current calculation system for electric vehicles subsidy of the country is planned to happen in October. It would be spearheaded by the country's Ministry of Environment after consultations with experts, concerned associations and municipalities. According to the report, higher-tier electric vehicles are anticipated to be removed following the series of consultations.
The report also revealed that Tesla earned 43% of the total 209.2 billion won or around $176 million of the EV subsidies in the first half of 2020. The Ministry of Environment would hold a meeting on August 10 with 11 automakers and sellers. This would include companies like Kia Motors and Hyundai Motor.
According to Choi Jong-won, head of the Air Quality Policy Bureau of the Ministry Of Environment, it is essential for electric vehicles to be deployed without any setbacks for the Green New Deal to yield results. He added that the ministry would closely work with businesses and groups in the industry. South Korea's Green New Deal project was launched in July as part of President Moon Jae-in's green growth program.
Other Tesla Details
Last year, Tesla debuted the Model 3 in the country. During the launch, it was obvious that buyers of Tesla Model 3 Standard Range would get around $16500 price slash from the sedan's $43000 starting price. Thanks to South Korea's EV subsidy, buyers in the country could purchase the Tesla Model 3 SR at around $27000. Since then, Tesla Model 3 has become one of the most imported electric vehicles in South Korea.
Recent data from the Korea Automobile Manufacturer Association revealed that there is a 40.1& increase in electric car sales from January to April 2020. Most of this is due to Tesla Model 3 Standard Range's sales.
