SEOUL—The South Korean government is deliberating on additional cuts to electric vehicle (EV) subsidies for the coming year, aiming to reallocate these funds towards enhancing the nation's EV charging infrastructure.
According to Yonhap News Agency, discussions are underway within key government ministries, including the finance and environment ministries, which are instrumental in shaping the EV subsidy policy. These talks are focused on adjusting the subsidy allocations for 2025, based on the state budget guidelines.
The finance ministry has highlighted the importance of optimizing the efficiency of EV subsidies alongside the augmentation of charging facilities. An official from the ministry shared that the subsidy policy's trajectory has been towards increasing the beneficiary count while diminishing the amount of individual support. This strategy intends to stretch the budget further, allowing for significant investments in charging infrastructure, identified as a critical area needing improvement.
In alignment with this strategic pivot, the government has already taken steps to curtail the budget earmarked for promoting zero-emission vehicles. From an allocation of 2.56 trillion won (approximately US$1.89 billion) in 2023, the funding has been scaled back to 2.31 trillion won for the current year.
Adding to these efforts, the environment ministry announced last month a revision to the electric vehicle purchase subsidy scheme. This revision saw a reduction in the maximum subsidy per EV from 5 million won to 4 million won, signaling a continued commitment to refining the support structure for EV adoption in favor of strengthening the charging infrastructure across the country.