Will a ban against vehicles ‘made in Korea for batteries’ be released?
Chinese automakers have applied for approval for five types of electric vehicles (EV) equipped with LG Chem and Samsung SDI batteries. China has not been granting subsidies to Korean-made battery-powered EVs since 2016.
According to the 318th preliminary announcement of the China Industrialization New Method Department, it has been confirmed that 5 kinds of EVs equipped with Samsung SDI and LG Chemical batteries were included. Those are one types with Samsung SDI battery (Jinfang Energy) and four types with LG Chem 4 battery (Dongfeng Motor, Dongfeng Renault). Samsung SDI used a cylinder type and LG Chem used a pouch type battery.
Becoming a candidate for type approval does not mean subsidies will be granted. After completing the preliminary announcement, the government will receive objections, and the final list will be announced. It is then noted on the list of new energy cars eligible for subsidies. It takes about a month to get to this point. The China Industrialization New Method Department included the EVs on the 15th of this month in the list of the preliminary announcement of type approval. At the earliest, whether it will be included in the subsidy list will be announced next month.
An industry official said, "The type approval is the minimum qualification for receiving the subsidy. EVs with LG Chem and SK Innovative batteries were approved several times, yet did not pass the final stage, only being tortured with the hope." In China, up to half of the EV price can be subsidized. Without the subsidy, it's hard to sell a car in effect.
The three domestic battery makers were excluded from China EV subsidies due to the deployment of the 2016 high-altitude missile defense system (THAAD, SAD). The government has tried several times to dismantle the band against made-in-Korea battery via ministerial meetings between Korea and China, which have not been successful.
Some say that it will not have a big effect even if it receives the subsidy this time because the subsidy policy will lapse next year.