South Korea wants to unite with Germany and EU

Zapping The Blogauto Test of the Cupra Born in Lapland

A US law that sets aside 70% of 72 EV models

US President Joe Biden signed into law on August 16 a bill associated with a $430 billion budget that, among other measures, ends tax credits for approximately 70% of the 72 models of electric vehicles that were previously eligible.

Hyundai, Kia and Porsche notably impacted

As a result, electric vehicles sold by South Korean automakers Hyundai, Kia, and German automaker Porsche (a Volkswagen Group subsidiary) and other automotive groups are no longer eligible for tax credits.

Mere coincidence? the Kia EV6 and Hyundai Ioniq 5 currently lead strong competition with the Ford Mustang Mach-E, Chevrolet Bolt, Nissan Leaf, Volkswagen ID.4 and Volvo XC40 Recharge.

South Korea wants talks with Germany and EU

“South Korea and Germany, which export electric vehicles to the United States, share similar concerns about U.S. law, and we plan to seek cooperation plans such as discussions with Germany and the European Union. European Union in the near future,” South Korea’s industry ministry said in an official statement.

He added that the Korea Automobile Manufacturers Association (KAMA) – an umbrella organization for the South Korean auto industry – was also planning to issue a joint statement on the matter with the European Automobile Manufacturers Association next September.

Protectionism also via critical minerals for batteries

New rules that come into effect next year also require that at least 40% of the monetary value of battery-critical minerals come from the United States or a U.S. free trade partner. The proportion will gradually increase to 80% in 2027.

US law could impact export of 100,000 South Korean electric vehicles per year

KAMA also said on Thursday that the US Inflation Reduction Act may impact the export of 100,000 South Korean electric vehicles per year, as electric vehicles assembled in South Korea will not be eligible for $7,500 tax subsidies introduced for EVs in the United States.

Win/lose ratios … the United States does not play the game

KAMA added that the discrimination against electric vehicles made in South Korea on electric vehicle tax advantages violated the spirit of an economic and security alliance between South Korea and the United States, while Hyundai and Samsung have announced investment plans in the US territory totaling over $27 billion.

In response to the new law, Hyundai Motor may bring forward the start date for construction of its electric vehicle and battery plant in the US state of Georgia, starting work as early as this year. South Korea will consider whether to file a complaint with the World Trade Organization over the US Inflation Reduction Act, over concerns the law violates WTO rules and a free trade agreement. -bilateral exchange between South Korea and the United States, Industry Minister Lee Chang-yang said during a parliamentary session on Monday.

Our opinion, by leblogauto.com

Enough is enough, South Korea sees red…. and intends to join forces with Germany, or even the European Union as a whole. Unity is strength.

Source: Reuters

to summarize

South Korea will seek cooperation with the European Union on the US Inflation Reduction Act that excludes electric vehicles (EVs) assembled outside North America from US tax credits, South Korea’s industry ministry said Thursday.
The text signed by Biden could impact the export of 100,000 South Korean electric vehicles per year, because electric vehicles assembled in South Korea will not be eligible for the $7,500 tax subsidies put in place for EVs in the USA.
“South Korea and Germany, which export electric vehicles to the United States, share similar concerns about U.S. law, and we plan to seek cooperation plans such as discussions with Germany and the European Union. European Union in the near future,” South Korea’s industry ministry said in an official statement.

Leave a Comment