The South Korean government has unveiled a plan to nurture the eco-friendly vehicle industry and to cut greenhouse gas emissions.
The Korean government is targeting to produce 1.2 million units of environment-friendly vehicles in 2015, or 21 percent of the domestic automobile market, and cut 3.3 million metric tons in greenhouse gas emissions.
The government will encourage the auto industry to make an aggressive investment in the next five years, while helping domestic companies develop core parts for green cars and charging stations by 2015, the Ministry of Knowledge Economy said in a statement.
The auto industry, which has invested a combined KRW1.3 trillion ($1.1 billion) in the past five years, plans to spend KRW3.1 trillion to develop green cars starting from 2011, the ministry added.
Earlier, the government had targeted to account 20 percent of passenger cars in South Korea by 2020 and provide subsidies and tax incentives to promote sales of electric vehicles.
According to a recent report from Bloomberg New Energy Finance, plug-in electric vehicles, including plug-in hybrids and battery electric vehicles, have the potential to make up 9 percent of auto sales in 2020 and 22 percent in 2030 (1.6 million and 4 million vehicle sales respectively).
The governments across the world have set aside billions of dollars in the form of subsidies for early adopters of these alternative energy cars and to boost production of batteries for such vehicles despite persisting doubts about how many people will actually buy them.
The Department of Energy said it is investing $2.85 billion in electric vehicles of which $2 billion will go to help US carmakers produce advanced vehicle batteries and drive train components. Around $400 million will be invested to buy, test, and deploy different types of electric vehicles in the marketplace, and $300 million in cost-share projects under the Clean Cities program.