Automotive Parts Industry Calls for Financial and R&D Support in Transition to Future Vehicles
As the 'Future Automotive Parts Industry Act' (Future Car Act), which provides the government's support basis for future car technology development, commercialization, and standardization, is set to be enforced this July, opinions have emerged within the automotive parts industry emphasizing the need for government policy support in areas such as finance and research and development (R&D).
The Ministry of Trade, Industry and Energy announced on the 30th that it held automotive parts company briefings across four major regions?Pyeongtaek in Gyeonggi, Daegu, Ulsan, and Gwangju?to collect industry requests and difficulties regarding these matters.
More than 500 representatives from approximately 350 parts companies attended the briefings. The industry stressed the need for support in finance, stable workforce supply, R&D, commercialization, and marketing. They urged that policies be implemented swiftly so that the Future Car Act can provide practical assistance as parts companies transition from traditional internal combustion engine vehicles to electric vehicles and others.
Regarding financial support, there were complaints that the loan screening criteria of financial institutions are too strict, making it difficult to actually obtain loans. Local small and medium-sized enterprises (SMEs) also reported difficulties in hiring software (SW) personnel due to frequent turnover and requested an expansion of regional workforce development support. There were also opinions that a cooperative network between finished car manufacturers and parts companies should be established to link R&D and commercialization, along with strengthened consulting and information provision.
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The Ministry of Trade, Industry and Energy stated that it will review these industry opinions, reflect them in the subordinate legislation of the Future Car Act, and create management cards for the requests to take follow-up actions. The ministry plans to establish a comprehensive future car transition system website by February to allow all government support projects related to the future car transition to be viewed at a glance.
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