Chinese electric vehicle (EV) maker BYD has failed to pass the South Korean government's evaluation for selecting operators of the electric vehicle dissemination project. Starting next month, BYD will not be able to receive domestic EV purchase subsidies for newly registered vehicles. A significant blow is expected for BYD, which had been accelerating its efforts to penetrate the South Korean market.
The Ministry of Climate, Energy and Environment (MCEE) announced the results of the evaluation for selecting operators of the electric vehicle dissemination project for the second half of this year on June 30 and stated that it selected a total of 27 manufacturers and importers as project operators. The evaluation is a system introduced for the first time this year, and only companies that pass the evaluation will become eligible for EV purchase subsidy support from the central government and local governments starting July 1.
A total of 35 companies participated in the evaluation, including overlaps between vehicle types. Among them, a total of 27 companies, including 10 passenger vehicle, 9 cargo vehicle, and 8 bus companies, met the criteria.
The passenger vehicle segment included Hyundai Motor Company, Kia, Renault Korea, and KG Mobility, as well as Tesla Korea, Mercedes-Benz Korea, BMW Korea, Volkswagen Group Korea, Volvo Car Korea, and Polestar Automotive Korea. On the other hand, BYD was excluded from the list.
The MCEE selected companies that scored 60 points or higher out of 100 as project operators after evaluating technological development capabilities, contribution to the supply chain, response to environmental policies, sustainability of after-sales service, and safety management. This system was introduced for the first time this year to more effectively utilize EV subsidies, which are funded by the national budget, for establishing a domestic EV ecosystem and protecting consumers.
However, according to transitional measures, existing subsidy-eligible vehicles can receive subsidies under the previous criteria, limited to applications submitted and accepted by June 30. BYD vehicles newly registered from July 1 will be excluded from the government subsidy targets. As BYD loses the purchase subsidy benefit, which is a key element of price competitiveness, attention is focused on whether the company will revise its South Korean market expansion strategy.
An MCEE official said, “We will continue to complement systems related to EV dissemination so that EV subsidies funded by the national budget can contribute more effectively to building a sustainable domestic EV ecosystem and vitalizing the public's use of EVs.”
