1st Announcement for the Automotive Parts Company Innovation Support Program
Launch of Support Group for Business Restructuring of Future Vehicle Transition Parts Companies


Support for automotive parts companies' transition to future vehicles is set to begin in earnest to overcome the crisis in the automotive industry caused by the aftermath of COVID-19.

On the 13th, the Ministry of Trade, Industry and Energy and the Korea Automotive Technology Institute (KATECH) announced the 'Automotive Parts Company Innovation Support Project' to support the strengthening of capabilities of automotive parts companies and their business transition to future vehicles.

This project is a follow-up measure to the 'Future Vehicle Industry Development Strategy' announced jointly by relevant ministries last October, and supports commercialization consulting, prototype production, evaluation, and certification for parts companies to transition to the future vehicle business.

This year's support budget is 5 billion won, and it is planned to support approximately 70 automotive parts companies that are preparing for or pursuing a business transition to future vehicles, providing up to 70 million won per company.

The project will be carried out in two phases this year, and following the first announcement (May 13–27), a second announcement is planned for July.

In addition, the Ministry of Trade, Industry and Energy has selected the Korea Automotive Research Institute as the support agency for automotive parts companies' transition to future vehicles and plans to launch a support task force for business restructuring of parts companies, composed of technology, financial, and export support organizations, to provide comprehensive support for the technology, funding, and market development necessary for the transition to future vehicles.

△ The Korea Automotive Research Institute's future vehicle businessIt serves as the control tower for the transition, and KOTRA supports market development by identifying overseas demand and linking it with overseas expansion support projects.

The Korea Technology Guarantee Fund and the Korea Credit Guarantee Fund provide financing consulting and policy fund linkages tailored to corporate situations, while KIAT and KEIT identify R&D needs and support participation in government R&D through partnerships with research institutions.

The Corporate Vitality Act Utilization Support Center supports the business restructuring of parts companies utilizing the Corporate Vitality Act, and associations and automakers support the identification of demand from automakers and large parts companies and the linkage of parts companies.

Choi Nam-ho, Director General of Manufacturing Industry Policy at the Ministry of Trade, Industry and Energy, stated, “We plan to actively support the business restructuring of automotive parts companies by utilizing the Corporate Vitality Act, which has expanded the scope of application and support benefits, such as tax incentives and location support, to include companies entering new industries like future vehicles, rather than those in oversupplied sectors.”