2020.08.21.  15,867 read Imports "Plug-in heyday"... Why is PHEV soaring?  Motorian 32

2020.08.21. 15,867 read Imports "Plug-in heyday"… Why is PHEV soaring? Motorian 32

In the imported car market, the advancement of the plug-in hybrid vehicle (PHEV) stands out. In addition to the release of models in various segments from different brands, the actual sales volume has increased remarkably. Even in the early days of domestic distribution, it was not attracted much attention because it was caught between electric and hybrid cars, but it is emerging as a new mainstream in the imported car market as it has price competitiveness in addition to the reflected profits from the expansion of the electric car market.

On August 20th, Ford Korea introduced the PHEV version of the large SUV’Explorer’. This is the first time that a PHEV has been introduced in Korea as a Ford brand. The Explorer PHEV has a 3.0 GTDI engine plus an electric motor that produces a peak output of 75kW (about 102 horsepower), and can run a combined 30km with pure electricity. Ford Korea explained that it has more powerful performance than the previous 2.3 model and is more efficient.

In addition to Explorer, the domestic landing of imported PHEVs is a quick step. Major imported car brands have already launched several PHEVs. Mercedes-Benz added PHEV version to major models such as E-class and S-class, and BMW also added 3·5· It is selling 6 types of PHEVs, including 7 series, X3, X5, and i8. Even Porsche, a sports car brand, has a PHEV lineup for major models such as Panamera and Cayenne. In addition, several brands such as Volvo and Toyota are selling PHEVs in the Korean market.

It is in contrast to the situation on the domestic brand side. At one time, five types of PHEVs were on the market at five domestic automakers, but as of August 2020, all of them are discontinued except for the Niro PHEV of Kia Motors. PHEV is disappearing in the domestic car market, but it is increasing in the imported car market. It is very unusual to show this trend even though the current PHEV subsidy is provided only to small and medium-sized vehicles that meet the emission gas and mileage requirements, so imports mainly focused on mid- to large-sized cars are rarely applied.

There are three reasons why PHEV’s popularity is increasing in the imported car market. The first is excellent efficiency. As diesel accounts for 70% of the total sales of imported cars in the past, imported car consumers’ interest in fuel economy is high. However, as diesel gates and diesel vehicle certification cancellations are one after another, imported car companies are reducing the introduction of diesel lineups in Korea. In such a situation, a gasoline engine is mounted, but a PHEV with excellent efficiency in the city is emerging as an alternative. Imports industry official said, “In the case of diesel cars, consumer interest has also decreased, but it is much more difficult and takes a long time to obtain a new certification after the event of certification cancellation.” He explained.

There is also an analysis that imported car prices, which are higher than domestic cars, are rather advantageous in securing price competitiveness of PHEV. In the case of domestic PHEVs that were able to receive subsidies in the past, even after receiving government subsidies of 5 million won, higher prices compared to hybrid or internal combustion locomotives of the same class were an obstacle. However, in the case of imported cars, the margin ratio is relatively high, so it can make up for the price increase of PHEV to some extent. In fact, the Mercedes-Benz GLE350e 4matic, which was released with a price tag similar to that of the diesel model in 2018, recorded hundreds of units per month and became the “most sold PHEV in Korea”.

As electric vehicles spread in earnest, there is also a reflection of the nationwide expansion of the charging infrastructure. As of the end of last year, there were more than 70,000 electric vehicle chargers across the country in common, non-public, slow and rapid. Additional 20,000 chargers will be installed this year, so it is now possible to easily find chargers in most new apartments, public parking lots, and rest areas. In the case of PHEV, a quick charger cannot be used, but a slow charger of about 60,000 units can be used, making charging much easier than at the beginning. Imports sales official said, “In the case of high-priced imported cars, most of the buyers live in apartments or detached houses, so there is no burden for charging PHEV.” Added.

As the demand for imported PHEVs increases, imported car brands are also on the rise to introduce new PHEVs. Peugeot, Citroen, and DS are considering adding PHEV lineups to next year’s flagship models 3008, 5008, 508, and DS7. It is known that Land Rover is also considering official launch, including introducing Range Rover PHEV in Korea in 2018.

As interest in PHEV increases, voices for reorganization of the subsidy system are also growing. Under the current system, in order to receive a PHEV subsidy of 5 million won, the size of the vehicle must be small and medium-sized while meeting the carbon dioxide emission of 50 g/km or less and the mileage of 30 km or more with one charge. Considering that large vehicles that consume a lot of fuel have a great effect on reducing carbon dioxide emissions when converting to PHEV, this is an anachronistic regulation. One expert said, “The current subsidy system does not take into account the characteristics of PHEVs, so it is an obstacle to the supply of PHEVs.” “We have to allocate the budget to PHEVs that can contribute.”

Reporter Jaewook Lee

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