South Korea fines Tesla $2.24 million for misleading ads

South Korea’s Fair Trade Commission said on Tuesday that it had decided to impose a fine of $2.24 million, equivalent to 2.85 billion won, on the US electric car maker “Tesla” and its South Korean unit for misleading advertisements.

According to the “Korean Yonhap Agency,” this step came at a time when “Tesla” made announcements in August 2019, in which it indicated that its electric car could “run at least” hundreds of kilometers, and this was what the committee considered an “exaggeration.”

The committee said: “The distance mentioned in the advertisements is only possible in light of the average temperature and in the city center areas. Under other conditions, the distance is shorter. And the actual distance decreased by up to 50.5% under cold temperatures

The commission also noted that the US automaker used expressions such as “up to 326 miles” in its advertisements in the United States.

And “Tesla” provided false information, given the speed of charging its cars as well

The committee said: “Without mentioning the types and test conditions, Tesla announced that its superchargers can charge cars enough to travel hundreds of kilometers in 15 or 30 minutes.”

“The test result was based on optimized conditions with high charging efficiency,” she said, adding that such performance could not be achieved under normal conditions.

And she added that while “Tesla” announced the performance of the “V3” model of its supercharger in 2019, the company installed it locally only after March 2021.

The committee also decided to impose a separate fine of one million won on Tesla for its unfair business practices

The move was in response to Tesla receiving commissions of 100,000 won per order for about a year starting from January 2020, without refunding them if consumers cancel their purchases.

The commission said that “Tesla” violated South Korean rules by not allowing buyers to cancel their online orders while requiring them to make phone calls.

Tesla accounted for 43.3 percent of the electric car market in Korea in the first half of 2020, according to data compiled by the commission followed by “Hyundai Motor” and “Kia” with rates of 29.8% and 14.1%, respectively.