Automotive Industry Calls for Introduction of Domestic EV Production Promotion Tax...Urges Support for Transition to Future Vehicles

KAIA Holds On-Site Meeting with Parts Industry in Pyeongtaek
Discusses Transition Challenges and Policy Tasks
"Rising Market Uncertainty and Labor Shortages"
Calls for Expanded Financial and Tax Support

The Korea Automobile & Mobility Industry Association (KAIA) announced on June 22 that it held an on-site meeting on "Transition of the Automotive Ecosystem" at Hyolim Precision in Pyeongtaek, Gyeonggi Province, to discuss the challenges faced during the shift toward future vehicles and to explore policy support measures.

This meeting was organized to review the current status of the auto parts industry's transition to future vehicles and to identify policy tasks aimed at strengthening the domestic automotive production base and the competitiveness of the parts ecosystem. Before the meeting, participants toured the Hyolim Precision production line to check the on-site conditions.

Industry representatives explained that they are encountering difficulties in business transformation due to market uncertainty during the transition to electric vehicles, intensified competition stemming from the rapid growth of Chinese electric vehicle manufacturers, and a shortage of skilled professionals. As solutions, they proposed the establishment of a consortium-based support system including automakers, parts suppliers, and material companies, the provision of technology roadmaps, support for market and patent information, and the expansion of testing and certification infrastructure—emphasizing the need for comprehensive support throughout the entire cycle.

In particular, participants agreed on the necessity of introducing a domestic electric vehicle production promotion tax system and expanding financial and tax support in order to boost domestic electric vehicle production and accelerate the transition of the parts industry to future vehicles. They also suggested measures to resolve labor shortages, such as nurturing research and production personnel, expanding the use of foreign workers, and increasing flexibility in working hour regulations.

Jung Daejin, president of KAIA, stated, "We must promptly introduce a domestic electric vehicle production promotion tax system to maintain and expand the domestic production base, and to support the electrification transition and investment capacity of the parts industry in future vehicles."

KAIA announced that, based on the on-site feedback raised during this meeting, it plans to continue identifying support tasks for the transition to future vehicles, including the introduction of a domestic electric vehicle production promotion tax system, and to strengthen cooperation with the government and related organizations.

This content was produced with the assistance of AI translation services.