Strong government support to drive EV charging infrastructure market in South Korea
So says Frost & Sullivan in its new analysis as it highlights that the South Korean Government has extended its subsidy for electric vehicles to private purchasers starting from 2014.
Samjeen Yun, senior industry analyst, automotive & transportation practice, Asia Pacific at the firm, said that the Government's subsidies for hardware and installation costs will act as a driver for the growth of electric vehicle charging infrastructure in South Korea.
She added that the Ministry of Environment South Korea has a 100% subsidy scheme for fast charging and the installation fee for DC chargers will act as a driver to increase the number of charging stations in South Korea.
‘A shorter charging time is one of end users' desired factors in EVs, and the increased availability of more of level 2 or DC charging in residences or local communities, which will lead to a higher customer acceptance and demand,’ she added.
Currently only two models of electric vehicles, the Kia Ray and Renault Samsung SM3 ZE, have been introduced in the South Korean market.
‘More number of electric vehicles and plug-in hybrid electric vehicles, especially in the small and medium segment, will likely drive the demand for charging stations,’ she said.
However, Ms Yun said that a long charging time for battery vehicles is likely a setback for the growth of electric vehicles.
‘There are various types of business models adopted by different participants in the market. However, due to high installation cost, high maintenance cost and low utilization rate, it is resulting in lower profit for the businesses,’ she added.
She said that automakers are currently investing more in the development of hybrid electric vehicles and fuel cell electric vehicles, which do not need charging infrastructure, therefore restricting the demand for charging stations.