Tesla Motors Inc.’s Model S 90D can now receive subsidies in South Korea, raising expectations that its sales would pick up six months after its launch in the country.
According to the auto industry on Friday, the Ministry of Environment has granted approval to subsidize the Model S 90D sedan, providing up to 14 million won ($12,300) in government subsidies and 10 million won in provincial subsidies for the car buyer.
The move comes six months after Tesla, dubbed “the Apple of electric cars,” first entered the Korean market with much fanfare. Unlike initial high expectations that the company would mimic the success it saw in other markets, car sales in Korea have remained weak, most likely due to the high price tag without subsidies. It has so far been denied subsidies due to regulations involving the battery charging time.
But with subsidies, the price of the Model S 90D will be knocked down to around 90 million won from the current 113.1 million won, a move that is expected to bolster sales.
The subsidies to Tesla’s vehicle are a follow-up measure after changes in the government’s electric vehicle subsidy regulations.
Under previous regulations, electric vehicles that require more than 10 hours to fully charge were not eligible for subsidies. Tesla failed to meet this standard because it used large, high-capacity batteries to offer long range, which need more than 10 hours to be fully charged. But the 10-hour rule was eventually scrapped in July amid growing criticisms that it did not reflect the current advances of long-range models.
The recent approval applies only to the Model S 90D. Results for the Model S 75D and 100D are still pending.
By Woo Je-yoon
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]