[Era of EV Battery Subscription and Lease ③] Concerns Over Effectiveness if There's No Difference From Existing Installments... Consumer Experience is the Key

[산업일보]
▶ Continued from the article, '[The Era of EV Battery Subscriptions and Leases ②] 'Battery Finance,' Will It Become the Missing Link Between EV Adoption and Resource Circulation?'

In the previous article, the financial and industrial sectors expected that separating the ownership of EVs and their batteries would lower initial purchase costs and serve as a catalyst for expanding the reuse and recycling markets. However, EV users believe that tangible cost reductions for consumers and the establishment of a reliable battery condition evaluation system must come first. Meanwhile, the government plans to promptly establish a management system—including the reorganization of subsidies and taxes—along with supporting regulatory sandbox demonstration projects prior to institutionalization.


Kim Sung-tae, Chairman of the Korea Electric Vehicle User Association, pointed out, "We welcome the alleviation of the initial cost burden through the introduction of separate registration for battery ownership. However, if newly emerging battery financial products like leases do not significantly differ from existing installment costs, there are concerns that their effectiveness will drop."

He noted, "Currently, auto insurance premiums for EVs are set higher than those for internal combustion engine vehicles because of the battery. The residual value of these batteries is evaluated by measuring their SOH (State of Health), but the measured values vary depending on the institution, company, or inspection solution, which is increasing market uncertainty."

Chairman Kim emphasized, "It is urgent to lay the legal and policy foundations so that the SOH evaluation system can be standardized through credible institutions."


Working-level officials from the Ministry of Land, Infrastructure and Transport (MOLIT), the Ministry of Trade, Industry and Energy (MOTIE), and the Ministry of Climate, Energy and Environment also attended the seminar to express their respective ministries' stances on the related systems.

Park Yong-sun, Director of the Automobile Policy Division at MOLIT, agreed on the necessity of separately registering battery ownership. He mentioned that MOLIT had pushed for the introduction of the system 3 to 4 years ago but halted it due to feedback pointing out the need for a legal amendment. He expressed expectations that the amendment to the Automobile Management Act, proposed by Representative Son Myung-soo in July, would add momentum to its institutionalization.

He explained, "Even before the revision of the Automobile Management Act, MOLIT is implementing regulatory sandbox projects so that subscription services based on ownership separation can be trialed. The key will be a transparent subscription service operating system that can protect consumers."


Ahn Jae-hoon, Director of the Automobile Division at MOTIE, emphasized, "The automotive industry is rapidly shifting toward future vehicles, centered around autonomous driving and electrification. Although the number of EVs distributed in Korea surpassed 1 million in April, we still have a long way to go compared to the total 22 million registered vehicles in the country."

Director Ahn pointed out, "Even in 2020, related ministries jointly announced the idea of a battery lease system, but six years have passed and it has yet to be commercialized." He noted that starting with the proposal of the ownership separation bill, related tasks such as the reorganization of EV subsidies and the establishment of a management system for used batteries must be discussed.


Park Pan-gyu, Director of the Decarbonization and Green Transportation Innovation Division at the Ministry of Climate, Energy and Environment, revealed that EVs accounted for more than 20% of new car registrations in the first half of this year. He further stated that related policies are being promoted with the goal of achieving a 50% penetration rate for zero-emission vehicles by 2030, analyzing that it is now time to move past the initial stage of EV supply and consider related business models.

Regarding the battery lease system, he offered a diagnosis similar to the officials from MOLIT and MOTIE, stating, "The core tasks will be setting up an A/S service system that allows immediate replacement when battery issues occur, along with calculating reasonable subscription fees for users."

Director Park stated, "We will do our best to ensure that various business models emerge in line with the era where EVs become the mainstream, and that consumer accessibility to EVs can be improved."