November 27, 2024

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Key officials of the automobile industry sign an agreement during a roundtable meeting in Seoul on Tuesday. (Yonhap)

The South Korean government and major carmakers will jointly invest more than 14.3 trillion won ($10.9 billion) to promote the transition of the conventional auto parts industry to gear up for a "speedy" and "flexible" transformation for future mobility, the Industry Ministry said Tuesday.

In a roundtable meeting of private auto and automotive parts companies, the Ministry of Trade, Industry and Energy announced a support measure under which the government and automakers will jointly support the auto parts industry to secure liquidity and technology development.

"Up until April this year, the country witnessed a record volume of car exports. With this trend, I expect the export volume will achieve a record of $80 billion this year," Industry Minister Lee Chang-yang said.

"The government and the private sector should join efforts to maintain the export trend, and at the same time should prepare for the era of future mobility."

Five automakers -- Hyundai Motor, Kia, GM Korea, Renault Korea Motors and KG Mobility -- also signed a joint agreement to cooperate on technology development and funding with the auto parts industry ahead of the roundtable meeting.

According to the ministry, they will provide auto parts suppliers with over 14.3 trillion won of funds for liquidity, as well as increasing orders, setting a goal for a fivefold increase in the production of electric vehicles by 2030.

The ministry said it will introduce a special law to support the industry to foster technological prowess and talents for future vehicles. It will also help the industry expand export to major markets of the United States and Europe, and other markets of the Middle East, China and Japan with great potential for growth.

From January to April this year, the combined exports of vehicles and auto parts reached an all-time high of $30.9 billion.

By Jo He-rim (herim@heraldcorp.com)