Government Finalizes '4th Basic Plan'
Lowering Production Costs for Domestic Parts and Materials... Positive Outlook for Electric Vehicles like Hyundai Ioniq
Significant Expansion of Infrastructure Including Ultra-Fast Chargers... 300km Driving Range with 20-Minute Charging
[Sejong=Asia Economy Reporters Haeyoung Kwon and Jehun Yoo] The government plans to distribute 7.85 million eco-friendly vehicles, including electric and hydrogen cars, by 2030. From 240,000 units in 2016 to 820,000 units distributed by last year, the scale is set to increase nearly tenfold over the next decade. Related infrastructure such as electric and hydrogen vehicle charging stations will also be significantly expanded, and electric vehicle prices will be reduced by 10 million KRW to stimulate demand. This is expected to be a positive factor for Hyundai Motor Company, which is about to launch the electric vehicle Ioniq 5.
On the 18th, the government finalized the "4th Basic Plan for Eco-Friendly Vehicles" at the National Policy Inspection and Coordination Meeting chaired by Prime Minister Chung Sye-kyun at Hyundai Motor and Kia Namyang Research Center in Hwaseong, Gyeonggi Province.
According to the basic plan, the government aims to distribute 2.83 million eco-friendly vehicles by 2025 and 7.85 million by 2030. Through this, it has set a goal to reduce automobile greenhouse gas emissions by 24%. Public institutions will be required to purchase 100% eco-friendly vehicles, and a purchase target system for eco-friendly vehicles will be introduced for private demand sectors such as rental cars and large corporations.
Charging infrastructure will also be greatly expanded. This is based on the judgment that the biggest obstacle to the distribution of electric and hydrogen vehicles is insufficient infrastructure. By 2025, the number of electric vehicle chargers will be increased to over 500,000 units, and more than 123 ultra-fast chargers capable of driving 300 km with a 20-minute charge will be distributed this year. Hydrogen vehicle chargers will also be established mainly in Seoul and the metropolitan area to ensure that charging stations can be reached within 30 minutes anywhere nationwide, with 450 units planned by 2025.
The price of eco-friendly vehicles will be reduced by more than 10 million KRW within five years. This will be achieved by domestic production of parts and materials such as electric truck and bus dedicated platforms, batteries, and fuel cells to lower production costs. Accordingly, if the Hyundai Motor Ioniq 5 is priced below 60 million KRW, it is expected that with subsidies included, it will be possible to purchase it in the 40 million KRW range.
Prime Minister Chung Sye-kyun declared the "first year of popularization of eco-friendly vehicles" at the first on-site National Policy Inspection and Coordination Meeting since his inauguration, stating, "We will create fixed demand by establishing a mandatory purchase target system for electric and hydrogen vehicles in the public sector." He added that private demand will also be encouraged by providing subsidies when rental, logistics, and transportation-related companies purchase eco-friendly vehicles, and related research support will be expanded.
At the site, Prime Minister Chung test-drove the electric vehicle Ioniq 5 at the research center's test driving course, guided by Chung Eui-sun, Chairman of Hyundai Motor Group. The Ioniq 5 is the first model to apply Hyundai Motor Group's dedicated electric vehicle platform and will be unveiled on the 23rd.
Regarding the battery rental business memorandum of understanding (MOU) signed between Hyundai Motor and LG Energy Solution, Prime Minister Chung said, "The battery rental business is significant as it completes the eco-friendly electric vehicle ecosystem," and urged, "Let the government and companies strengthen capabilities through solidarity and cooperation and adapt to changes."
Hyundai Motor plans to expand its electric vehicle lineup from the current 8 models to 23 models by 2025 through its Hyundai Motor, Genesis, and Kia brands, aiming to sell 1 million units annually in the global market.
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