Mercedes-Benz Korea President and CEO Mathias Vaitl attends a meeting with residents from an apartment complex in Incheon, Wednesday. Earlier this month, the carmaker's EQE electric vehicle, parked at an underground garage there, burst into flames, causing damage to other vehicles. Yonhap
Customer concerns about electric vehicles (EVs) have intensified following a recent fire report involving an all-electric Model X luxury SUV from Tesla, the most beloved EV maker in Korea.
The incident further fueled the widespread fear of EVs here, after Mercedes-Benz's EQE EV burst into flames earlier this month. Drivers have since rapidly lost trust in the once-reliable German carmaker after it became known that the vehicle was equipped with a less-reliable Chinese battery.
The recent fire involving a Model X resulted in the vehicle being completely destroyed after approximately four hours of firefighting efforts. The vehicle was parked on a road in Yongin, Gyeonggi Province, on Friday afternoon.
Tesla used a battery from Japan's Panasonic for its EV. This heightened fears that batteries from famous non-Chinese firms are also not safe either.
Tesla's involvement in a similar incident raises further concerns about EVs here, especially as the U.S. automaker makes rapid inroads into the Korean market. According to data from the Korea Automobile Importers & Distributors Association, Tesla topped the list in EV sales for the first seven months this year. The company sold a total of 20,060 EVs between January and July, the largest among EV makers here, surpassing sales from strong home-grown rivals such as Hyundai Motor and Kia.
Neither of the two carmakers have announced any specific countermeasures to alleviate the lingering consumer fears. Mercedes-Benz Korea left open the possibility of offering compensation to those who suffered financial damage from the latest EQE fiasco, but did not share any other action plans, such as a recall of the model.
A joint investigation by police, the fire authority and Mercedes-Benz Korea is underway to determine the cause of the fire that destroyed an EQE electric sedan in Incheon, Aug. 8. Yonhap
The government is urging carmakers to conduct special inspections of their EV lineups to ease growing customers' concerns about EVs. Land Minister Park Sang-woo said Friday that the government will share a comprehensive measure to strengthen EV safety sometime early next month.
Experts have attributed the persistent EV fires to internal defects in the battery cells.
“Any possible defects inside a battery cell is presumably the most reasonable cause (behind the latest EQE fire),” Yoon Won-sub, a professor of energy science at Sungkyunkwan University, told reporters during a recent media interview.
The professor also expressed more trust in Korean battery manufacturers, such as LG Energy Solution, Samsung SDI and SK On, in terms of safety.
“I cannot say for sure that the three battery makers can guarantee 100-percent safety, but it is true that they gain more competitive edges than any other global battery counterparts (in terms of safety),” he said.
However, the growing fears concerning more such EV fires have negatively impacted battery stocks. According to data from the Korea Exchange, the KRX Secondary Battery Top 10 Index fell by 0.97 percent on Friday from the previous day despite the benchmark KOSPI achieving a major rebound of around 2 percent during the same period. The index includes shares of LG Energy Solution and Samsung SDI.
Major brokerages, such as Mirae Asset Securities, are on track to revise their target stock price on secondary battery shares.