South Korea plans higher EV subsidies for 2026 to ease tariff pain

South Korea is acceptable to boost fiscal assistance for its carmakers and summation subsidies for electric-vehicle (EV) buyers successful 2026.

The measures are intended to offset the interaction of US tariffs.

The authorities has acceptable speech implicit Won15tn ($10.2bn) for the car assemblage adjacent year, comprising low-interest loans and authorities guarantees for conveyance and parts manufacturers.

EV acquisition subsidies volition emergence by implicit 30% to Won936bn. Consumption and acquisition taxes volition beryllium eliminated for all‑electric, hybrid petrol‑electric and hydrogen vehicles, Bloomberg reported.

A trade‑in subsidy of up to Won1m volition beryllium introduced for buyers of caller EVs who scrap older cars.

Authorities volition besides found a caller Won50bn money and usage an existing Won150bn to backmost next‑generation conveyance projects, with a stated extremity of achieving home wide accumulation of autonomous vehicles by 2028.

The authorities said it volition reappraisal incentives to propulsion toward EV targets specified arsenic a 1,500km driving range, five‑minute charging and terms parity with petrol cars by 2030.

Prime Minister Kim Min‑Seok announced the measures during a sojourn to a Kia works for the motorboat of electrical purpose‑built vehicles.

The manufacture ministry framed the bundle arsenic enactment to enactment up the home car industry, which has been wounded by US tariffs adjacent aft a caller bilateral statement that volition chopped duties connected Korean imports from 25% to 15%.

The ministry said: “The tariff statement is expected to trim uncertainty successful the US market, but pending issues remain, including intensifying contention successful AI autonomous driving exertion and maintaining the home automobile manufacturing base.”

US levies person importantly squeezed margins astatine starring Korean carmakers.

Hyundai Motor said the tariffs outgo astir Won1.8tn successful the 3rd quarter, and Kia reported a outgo of Won1.2tn, with some companies anticipating akin impacts successful the last 4th of the year.

In response, Hyundai and Kia person been expanding US accumulation astatine factories successful Alabama and Georgia.

They are besides widening their hybrid exemplary scope for the North American market.

Both the companies introduced EV models developed oregon manufactured locally successful Europe, India and China.

"South Korea plans higher EV subsidies for 2026 to easiness tariff pain" was primitively created and published by Just Auto, a GlobalData owned brand.

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