Gov't flip-flops on hydrogen fuel-cell vehicles

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Biz & Tech

Tue, April 24, 2018 | 13:29

Automotive

Gov't flip-flops on hydrogen fuel-cell vehicles

Posted : 2018-04-08 16:42

Updated : 2018-04-09 11:37

The Hyundai Motor NEXO hydrogen fuel-cell electric vehicle / Courtesy of Hyundai Motor

By Park Jae-hyuk

The government's recent decision to freeze the amount of subsidies for hydrogen fuel-cell electric vehicles (FCEV) has enraged consumers who have already purchased the pollution-free vehicles to reduce the nation's deadly fine dust.

According to the supplementary budget bill that the Ministry of Strategy and Finance unveiled last week, the government has decided to subsidize the owners of only 240 hydrogen FCEVs as planned, while offering an additional 119 billion won ($111.3 million) to the owners of electric vehicles (EV).

The ministry said it could not give benefits to the single manufacturer of hydrogen FCEVs ― Hyundai Motor.

However, the government's plan is in sharp contrast to President Moon Jae-in's previous promises made in February, when he was offered a test-ride for the Hyundai Motor NEXO hydrogen fuel-cell SUV on the Seoul-Busan Expressway.

"I decided to make efforts to increase supplies of such futuristic cars as EVs and hydrogen FCEVs," Moon said at that time. "Eco-friendly cars and autonomous driving have already become the general trend."

Considering the extra budget, consumers have now been regarding the President's remarks as empty promises.

They are criticizing the administration for its shortsighted policy, saying the government should put its top priority on commercialization of hydrogen FCEVs that have been known for reducing more pollutants than ordinary EVs.

While the NEXO is equipped with an air-purifying system to eliminate fine dust, ordinary electric cars emit almost the same amount of fine dust as vehicles with combustion engines do.

However, pre-orders for about 900 NEXO SUVs will likely be cancelled for now, given that Hyundai received 1,164 pre-orders for the nation's only hydrogen FCEV as of April 4.

According to the country's largest carmaker, a NEXO costs from 68.9 million won to 72.2 million won, depending on its trim level, but the actual price was expected to be lower than 40 million won due to subsidies from the central and local governments.

If the central government declines to subsidize more hydrogen FCEVs, local governments cannot independently execute their budgets for the extra purchase of the vehicles.

Industry officials pointed out the government's uncooperative behavior would hinder the country from competing with Japan, Germany and China in the development of hydrogen FCEVs.

They said Korea may not maintain the lead in technologies for hydrogen FCEVs without government support.

According to the Korea Trade-Investment Promotion Agency, Japan's Ministry of Economy, Trade and Industry has recently vowed to push ahead with deregulations on hydrogen infrastructure, development of related technologies and support for building hydrogen power stations.

A consortium of 11 Japanese companies, including Toyota, Nissan, JXTG and Idemitsu also set up a joint venture for construction of a hydrogen refueling network across Japan.

Last year, Japanese Prime Minister Shinzo Abe said the country will build the world's first hydrogen society with an international hydrogen supply network for stable demands.

The Japanese government began a plan to increase the number of hydrogen FCEVs to 40,000 in 2020 from 1,800 last year.

jaehyuk@ktimes.com