South Korea has imposed a 2.85 billion won ($2.2 million) fine on Tesla Motors for not telling its customers about the dramatic fall in driving range of its electric vehicles (EVs) in low temperatures.
Korea’s antitrust regulator, the Korean Fair Trade Commission (KFTC), said the fine was for misleading advertisements.
The KFTC said Tesla exaggerated the “driving ranges of its cars on a single charge, their fuel cost-effectiveness compared to gasoline vehicles as well as the performance of its superchargers” on its official local website since August 2019 until recently.
The driving range of the Teslas went down in cold weather by up to 50.5 percent instead of how they were advertised online, the KFTC said in a statement.
“The distance mentioned in the advertisements is only possible under an average temperature and in downtown areas. Under other conditions, the distance is shorter,” the KFTC said. “The actual range fell up to 50.5 percent under colder temperatures.”
The KFTC also pointed out that Tesla used vague wordings, such as “up to 326 miles”, in its advertisements.
The company also provided false information about its charging speed.
“Without mentioning types and test conditions, Tesla advertised that its superchargers can charge automobiles enough to run hundreds of kilometers in 15 or 30 minutes,” KFTC added.
“The test result was based on optimised conditions with high charging efficiency.”
The Korea Times reported that the KFTC also decided to slap a separate fine of 1 million won on Tesla for unfair business practices.
The move was in response to Tesla receiving advance of 100,000 won for every order for around a year starting in January 2020, and not refunding them when consumers cancelled their orders. The company violated local rules by not allowing buyers to cancel their orders online and requiring them to make phone calls.
The automotive and clean energy company has the highest market share of 43.3 percent in the electric vehicle segment in Korea, followed by Hyundai Motor and Kia at 29.8 and 14.1 percent, respectively.
In 2021, Citizens United for Consumer Sovereignty, a South Korean consumer group, said the driving range of most EVs drop by up to 40% in cold temperatures when batteries need to be heated, with Tesla suffering the most, citing data from the country’s environment ministry.
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