The era of internal combustion vehicles is drawing to a close... Government to channel 1.8 trillion won into future mobility this year

[Financial News] Financial authorities are stepping up support to shift the automotive industry ecosystem toward eco-friendly and autonomous future mobility. They plan to provide a total of 1.8 trillion won in policy financing this year, including 970 billion won to help auto parts makers improve their fundamentals and 830 billion won to foster the future mobility industry. The National Growth Fund will also invest 1.5 trillion won in the mobility sector over the next five years.
On the 14th, the Financial Services Commission (FSC) and the Ministry of Trade and Industry held a public-private joint meeting on future mobility transition and launched the Future Mobility Parts Industry Council at the Korea Auto Industries Coop. Association (KAICA) in Seocho District, Seoul. The council plans to identify difficulties faced by parts makers across all areas, including finance, research and development (R&D), exports and labor, and support the transition of the ecosystem.
The FSC noted that as demand for equipment and R&D investment rises during the transition to future mobility, the financial burden on small and mid-sized parts companies is growing. In response, it unveiled a plan to provide 1.8 trillion won in policy financing this year and to channel 1.5 trillion won into the mobility sector over the next five years through the National Growth Fund.
Korea Automotive Technology Institute (KATECH) also released the results of the 2025 Automotive Parts Industry Survey, which was designated as a state-approved statistic. The survey showed that South Korea has a total of 21,000 automotive parts businesses, employing 456,000 people and generating 207.6 trillion won in sales. Of those, 4,142 companies, or 19.7%, produce only parts for internal combustion vehicles, while just 578 companies, or 2.7%, make parts exclusively for future mobility.
Only 1,286 companies, or 6.1% of the total, said they are shifting or diversifying their businesses in response to the transition to future mobility. Parts makers cited financing, a lack of technological competitiveness and difficulties in securing workers as major obstacles to business transformation and diversification.
Kwon Dae-young, Vice Chairman of the Financial Services Commission, said, "The automotive industry is now evolving into a converged high-tech industry that combines artificial intelligence (AI), semiconductors, software and data with auto parts, and it is becoming a 'national all-out effort.'" He added, "To support bold restructuring and stronger competitiveness in the auto industry, we will work closely with relevant ministries and provide full-scale support so that R&D, infrastructure investment and financial assistance are organically connected."
zoom@fnnews.com Lee Jumi Reporter