South Korea’s Ministry of Trade, Industry and Energy announced plans to allocate 1.5 trillion won ($1.02 billion) in 2025 to encourage domestic consumers to purchase electric vehicles (EVs), aiming to boost sales amidst concerns about safety and limited access to charging infrastructure.
The government’s initiative follows a decline in domestic EV sales, which dropped by 9.7% in 2024, marking the second consecutive year of reduced demand. The number of EVs and hydrogen fuel cell cars in South Korea reached 720,000 by the end of 2024, with EVs accounting for 680,000 of that total. One significant factor affecting consumer sentiment has been safety concerns, especially following an August incident involving a fire from a Mercedes-Benz EV, which led to the destruction of over 100 vehicles and an underground parking garage in Incheon.
“The government will seek to ease the financial burden on consumers for eco-friendly cars and enhance their trust,” the Ministry stated, outlining a range of financial incentives. Starting this month, young buyers purchasing an EV as their first car will receive a 20% discount, while families with two or more children can benefit from additional discounts. Families with two children will receive 1 million won ($685), while those with three or four children will be eligible for discounts of 2 million won and 3 million won, respectively.
The government also announced plans to invest 375.8 billion won to install 4,400 fast-charging stations across the country. “We are committed to increasing the availability of charging infrastructure to make the transition to EVs more accessible and convenient for consumers,” the Ministry added. Furthermore, the government aims to ensure that at least 10% of vehicles used for testing at drivers’ license centers are EVs by the end of 2025. Policies will also be developed to encourage places like supermarkets and theaters to install charging stations designed for visitors staying for extended periods.
Source: Korea Times
