 fire incident in Incheon, skepticism has been mounting against Chinese-made batteries.){kind=link}
Following the recent electric vehicle (EV) fire incident in Incheon, skepticism has been mounting against Chinese-made batteries. Consequently, this has drawn attention to the movements of the world’s leading EV manufacturer, BYD, which is set to debut its passenger cars in South Korea by the end of 2024.
According to industry sources, a fire erupted in an underground parking lot in Incheon, west of Seoul, on August 1, causing significant damage. The blaze reportedly started spontaneously in Mercedes-Benz batteries that use Chinese Farasis Energy cells.
Farasis, a Chinese EV manufacturer ranked among the top ten battery manufacturers globally, had previously recalled over 30,000 units in China in 2021 due to fire risks.
This incident has sparked worries about the quality of Chinese-made batteries. Although the exact cause of the fire is still unclear, the fact that it happened to an electric vehicle parked for several days has heightened anxiety among South Korean EV owners.
This situation is understandably concerning for BYD, which recently announced its move into the South Korean passenger car market after already establishing a foothold in commercial vehicles. BYD Korea plans to finalize its dealer selections and set up its passenger vehicle division by the third quarter, with an official brand launch in South Korea following shortly after.
BYD manufactures both batteries and vehicles and has achieved impressive results, surpassing Tesla to become the top global EV seller from last year through the first half of this year. BYD ranks second in battery usage, trailing only behind China’s CATL, a leading manufacturer. Some experts argue that it’s unfair to directly compare BYD’s technology with Farasis, which has recently been scrutinized.
Furthermore, unlike the problematic Farasis NCM (Nickel-Cobalt-Manganese) batteries, BYD primarily uses LFP (Lithium Iron Phosphate) batteries in its EVs. A BYD Korea representative stated, “The Blade battery used in BYD vehicles is based on LFP technology, which offers greater stability than NCM batteries. Therefore, this incident is not directly related and will have minimal impact on our overseas entry plans.”
However, the problems with Farasis batteries might spark a broader distrust of Chinese-made batteries and components among consumers. This growing skepticism could make it harder for Chinese electric vehicles to enter the domestic market. One consumer shared, “I’m usually okay with buying inexpensive items from Chinese e-commerce, but cars are a major purchase tied directly to safety. Given the recent battery fires, I’m now hesitant and might steer clear of Chinese products for a while.”
Even if BYD Korea launches its first passenger car as planned this year, it seems unlikely that the company will easily escape the repercussions of this incident. The combination of a temporary stagnation in EV demand and concerns over fire risks is likely to lead to a decreased consumer interest. A dealer from company B noted, “Since the fire incident, we’ve received numerous inquiries about canceling electric vehicle orders, and delivery dates are being moved up. Many customers want to wait and see for a while.”
“This fire incident isn’t just a problem for one brand; it has become a broader trust issue for the entire EV industry. Even brands and models with no previous fire incidents are now facing heightened scrutiny and concern about electric vehicles,” an industry insider commented.
“Restoring consumer trust is a top priority.”