By Kang Doo-soon and Minu Kim
All eco-friendly cars with Korea-produced batteries have been excluded once again from receiving government subsidies in China to suggest prospects in the world’s biggest EV market remain murky for Korean manufacturers despite recent efforts to resolve conflict over installment of a U.S. antimissile system between the two governments.
According to sources on Wednesday, the Chinese Ministry of Industry and Information Technology (MIIT) announced its targets for green vehicle subsidy payouts for the 12th time in 2017, where electric cars equipped with batteries produced by Korean companies were omitted from the list. For Chinese electric car makers, subsidies make up more than half of the price of the vehicle. If companies cannot receive government aid, they cannot expect to sell them.
EVs powered by batteries from Samsung SDI, LG Chem and other Korean companies have been excluded from the subsidy list since Dec. 29, 2016. The Chinese government then announced that it would be giving subsidies to electric car models from different companies, including the models equipped with electric car batteries produced by Korean companies, but it suddenly retracted its support for four EV models equipped with Korea-manufactured batteries and made another official announcement for subsidy payouts.
Since then, the MIIT has updated the list but none of the car models utilizing Korean batteries so far made the list.
Moreover, Korean manufacturers failed to pass the local government’s certification system launched in 2016. Samsung SDI and LG Chem have prepped to apply for the fifth certification review, but there is no progress since Chinese authorities stopped receiving applications.