Korea seeks to rev up green car sales

More than 1 million environmentally friendly cars could hit the roads in the next five years under a plan unveiled by the government Tuesday, as part of efforts to reduce greenhouse emissions and generate new sources of economic growth.

The government plan approved in a Cabinet meeting on the same day aims to increase the proportion of green cars among new vehicles sold in the country to 20 percent, from the current 2 percent, by the year 2020. About 80,000 green cars including hybrids, electric-vehicles and hydrogen fuel-cell cars were sold this year. The government’s new target aims to significantly increase the number by 920,000 units per year in 2020.

In a five-year plan announced by the Ministry of Trade, Industry and Energy, about 150 billion won ($127 million) will be invested in R&D projects to improve the driving range of battery-powered cars and induce local carmakers to lower retail prices of fuel-cell electric cars.

The R&D projects will focus on enhancing battery performance in order to double the battery pack capacity from the current 27 kilowatt-hours, the ministry said, adding that such a development could raise the competitiveness of Korean green cars in the global market. The government also hopes that about 600,000 eco-friendly cars, worth about 18 trillion won, will be exported in the next five years.

“Sales of eco-friendly vehicles have grown 20 percent annually in the last five years, six-times faster than that of conventional motor vehicles,” the ministry said. “With nations stepping up efforts to tackle climate change as well as accelerating technological development, roughly half of all cars sold around the world by 2030 will be eco-friendly cars.”

To enhance drivers’ convenience, about 1,400 rapid chargers for electric cars and 80 filling stations for hydrogen-powered cars will be installed in cities with relatively high numbers of green cars. The government also plans to subsidize purchases of new eco-friendly cars, while revising relevant laws to secure drivers’ safety.

The government has been seeking ways to cut emissions through the development of new energy industries and other manufacturing sectors.

In June, Korea, the world’s seventh-largest producer of carbon dioxide, offered to cut greenhouse gas emissions by 37 percent from projected levels by 2030. By expanding the number of green cars, the country aims to cut greenhouse gas emissions from vehicles by 3.8 million tons or 11 percent from business-as-usual levels by the year 2020.

In an ambitious move, the Park Geun-hye government has also said it would turn Jejudo Island into an electric car-only zone by 2030.

Korean carmakers have been also jumping into the market, particularly in the aftermath of the Volkswagen emissions-cheating scandal.

Hyundai Motor and its affiliate Kia Motors said they would invest a total of 11.3 trillion won in developing eco-friendly cars by 2018 to raise their positions in the global green car market.

Hyundai-Kia also plans to expand its lineup of eco-friendly cars to 22 models by 2020.

The Trade Ministry estimates technological level of Korean carmakers in green cars at around 93 percent of global leaders. But the government believes that they can narrow the gap to 96 percent by 2020 and be on par five years later.

By Cho Chung-un (christory@heraldcorp.com)