Report urges auto industry to go electric

Korea needs to give equal emphasis to the development of battery electric vehicles and fuel cell cars, considering the estimated future demand and the country’s competitiveness, a report said Thursday.

“It’s a well-known fact that our car manufacturers have the mass-production technology for fuel cell automobiles,” the report from the Korea Institute for Industrial Economics & Trade (KIET) said. “However, the accumulated sales of fuel cell electric vehicles (FCEVs) worldwide stopped at 10,000 as of the end of 2018. The demand for fuel cell vehicles in 2030 will be less than 2 percent of the global sales of new automobiles.”

In comparison, sales of battery electric vehicles (EVs) are estimated to exceed the demand for hybrids this year, 10 years since their commercialization, and show fast-paced growth, the report argued. Global rivals are due to market more than 100 different EV models by 2022, it noted.

Korea’s high competitiveness in EV batteries is another reason why the government should not neglect investment in electric cars, the report said, warning that the relative weaknesses in the availability of charging stations and other networks could drag down the industry, despite efforts by local automakers to diversify their EV models. The report responded skeptically to the government announcement in December to give 2 trillion won ($1.79 billion) in assistance to reform the car parts industry.

“If the auto industry, the recipient, is unable to fully accommodate, it could be difficult for the assistance to have the desired effect,” it said.

The same report predicted hard times ahead for local auto companies, affected by the global slump in the car industry.

Yonhap