NABO Industry Trends & Issues (Issue No. 82)

 

Published on June 25, 2026
Published by Industry & Energy Analysis Division

 

■ Industry Trends
   In recent months, the Korean economy has shown modest improvement thanks to robust exports and increasing production in the service sector, while downside risks such as the continued slump in the construction sector and rising energy prices following the outbreak of war in the Middle East persist. In April 2026, overall industrial production grew by 2.4% YoY, driven by increases in services and manufacturing output of 3.5% and 1.6% YoY, respectively, despite a 5.5% YoY decrease in construction. Exports across Korea's 13 key sectors totaled USD 72.59 billion in May, representing a YoY increase of 64.7%, driven by surging demand for memory chips and SSDs associated with increased investments in AI servers. In May, oil prices remained at high levels around USD 100.4 per barrel (an increase of 60.1% YoY) due to reduced production following the war in the Middle East and limited shipping caused by the blockade of the Strait of Hormuz. Non-ferrous metal prices soared by 39.3% YoY in the same month, reflecting the supply risks following the war, and the cereals price index increased by 11.5% YoY, driven primarily by soybean and wheat price increases. In April, the volume of KAU24 traded under the national emissions trading scheme increased by 23.7% MoM to 8.728 million tons, and the closing price increased by 9.3% MoM to KRW 17,050 per ton.
 

■ Industry Issues: Policy Tasks to Promote the Transition of Commercial Vehicles-Particularly Taxis-to Electric Vehicles
   Despite a wide range of public policies aimed at promoting carbon neutrality in the transportation sector, such as subsidies for zero-emission vehicles, actual reductions of greenhouse gas emissions have been limited. For this reason, attention needs to be paid to promoting the use of electric commercial vehicles, particularly electric taxis, as a policy measure to reduce greenhouse gas emissions in the road transportation sector. In general, commercial vehicles drive longer distances and have higher carbon intensity and energy efficiency compared to non-commercial vehicles. In 2021 and 2022, the number of new electric taxis increased significantly thanks to exemptions from the taxi shift system for eco-friendly vehicles and additional subsidies provided exclusively for taxis. However, such numbers have decreased from the second half of 2023 due to reduced economic incentives caused by the so-called 'electric car chasm phenomenon', the lifting of the taxi shift system, and other deregulation measures. Against this backdrop, this report estimates the total cost of ownership (TCO) by taxi type and suggests policy implications for promoting the transition to electric vehicles. Analysis finds that the TCO is estimated at KRW 99.1 million for hybrid taxis, KRW 86.9 million for LPG taxis, and 82.3 million for electric taxis, assuming a driving distance of 400,000 km over five years. The initial acquisition cost for LPG taxis is lower than that for electric taxis by 9.48 million, due to cheaper vehicle prices and fuel subsidies, but such differences are offset by favorable tax benefits, purchase subsidies, and lower charging costs for electric taxis. Assuming LPG prices remain stable, this cost difference is expected to narrow if charging costs for electric vehicles rise to levels sufficient to cover power generation costs in the future. This situation requires a comprehensive policy review to promote the transition to electric taxis.