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Incheon rising as a future mobility hub

City to focus ondeveloping connected car technology and establish a new organization supportingrelated certifications

Incheon is a pioneer inthe automobile industry. Some may question the city’s credentials in the autoindustry, yet a closer look at Incheon’s history in the Korean automobileindustry reveals just how important the city has been to the development ofcars in Korea.
In August 1962, with the establishment of Korea's first modern automobilefactory in Bupyeong, Incheon left an indelible mark in the Korean automobileindustry, and at the same time, became a nursing ground for Korean automakers.



▲ Incheon MetropolitanCity developed what it calls the “Comprehensive Plan for Fostering the FutureAutomobile Industry of Incheon,” which involves investing KRW 110.4 billionover five years to restructure the auto parts industry, one of the region's keyindustries, by upgrading related technology in a way that better responds tofuture mobility, and to make Incheon a hub of the future automobileindustry. (Image is a rendering of a future car.)

In fact, at the veryfoundation of Incheon's manufacturing industry is the automobile industry. Theautomobile industry ranks second in Incheon's manufacturing sector, but theautomobile market is shrinking by 5% in size every year due to the recentshrinking of the internal combustion engine (ICE) vehicle market. This is aclear sign that the automobile market is possibly entering a recession, whichmeans the City’s priority should be to restructure the industry and focus moreon future modes of mobility.

In order to shift theparadigm of the industrial structure and nurture companies for the futureautomobile industry, the City Government is hastening the conversion of autoparts companies across Incheon to future car-related businesses. At present, itis estimated that there are 628 auto parts companies in Incheon. Several ofthese companies, however, are producing parts for ICE vehicles, which meansthey are ill-equipped to respond to the transition to future cars. The size ofthe Incheon automobile industry is decreasing by 5.5% in terms of the number ofestablishments, 5.2% in terms of employees, and 6.2% in exports. In otherwords, the City needs to create an ecosystem that supports the auto industry’sswift transition to future mobility, and make some bold investments.

Thus, Incheon MetropolitanCity developed what it calls the “Comprehensive Plan for Fostering the FutureAutomobile Industry of Incheon,” which involves investing KRW 110.4 billionover five years to restructure the auto parts industry, one of the region's keyindustries, by upgrading related technology in a way that better responds tofuture mobility, and to make Incheon a hub of the future automobile industry.


▲ The Comprehensive Planfor Fostering the Future Car Industry of Incheon consists of five strategiesand 25 key initiatives with the vision to make “Incheon, a leading city offuture automobile technology innovation.”

The Comprehensive Plan forFostering the Future Car Industry of Incheon consists of five strategies and 25key initiatives with the vision to make “Incheon, a leading city of futureautomobile technology innovation.” The five strategies (25 tasks) include:specializing in the connected car industry (establish materials/partscertification evaluation centers, support the development of specializedtechnology, support the testing and evaluations for material/partscertifications, identify and develop “new players,” establish mid- to long-termspecialized development strategies); spearheading the development of autonomousdriving car technology (promote technology development innovation projects,support R&D projects, install R&D equipment, establish proving grounds,host competitions on developing new technology); promoting the transition oftechnology for future car parts companies (analyze future car technologystructures and parts, provide consulting services, support the joint planningof R&D initiatives, offer professional training, support the development oftechnology to localize materials and parts); supporting the innovative growthof future car parts companies (support innovation in digital manufacturing,support global marketing activities, foster unicorn startups, providespecialized support for electric vehicle parts companies, establish a platformto support cooperation between large and small businesses); establishing asystem that supports the future car industry (establish an integrated supportcenter for future cars, enact city ordinances to support the auto industry,establish a future car parts company council, execute fact-finding surveys andpolicy research, operate new collaborative governance initiatives).



▲ Rendering of a futurecar

The Comprehensive Plan forFostering the Future Car Industry of Incheon is for the automobile industry torapidly shift from ICE vehicles (gasoline and diesel vehicles) to eco-friendlyvehicles (electric and hydrogen vehicles), autonomous driving vehicles, andconnected cars (intelligent vehicles connected to surrounding objects through atwo-way wireless communication network). The Plan was created to activelysupport the technological transformation of local auto parts companies in linewith future trends anticipated in the auto industry going forward.

To keep up with globaltrends, Incheon is transforming the city's automobile industry structure into a“CASE” structure, which is considered key for autonomous driving. CASE standsfor “Connected, Autonomous, Sharing, and Electricity.” But more recently,“Mobility” and “Digitalization” have also been added to the scope of whatcounts as part of CASE. In the future, electric vehicles are expected to growat an average annual rate of 31%, whereas autonomous driving cars and connectedcars are expected to grow at an average of 40% and 22% per year, respectively.

Moreover, the City willfocus on developing connected cars as its specialty, which could differentiateit from other cities and provinces in Korea. A connected car is a coretechnology for future vehicles. It utilizes Vehicle to Everything (V2X)wireless communication technology that connects vehicles and everything in real-timeto provide various driver services, including infotainment services. Incombination with existing autonomous driving technology that recognizes, makesdecisions, and controls objects using radar, camera, and GPS, connected carswill likely deliver a complete autonomous driving experience.

To that end, for the firsttime in Korea, Incheon has established a connected car certification supportcenter in Cheongna Robot Land, laying the groundwork for further innovation inthe future car industry. Last year, the City also established a cooperativesystem with the Korea Automobile Research Institute, the only specializedautomotive research institute in Korea, and attracted a branch office of theAutonomous Driving Technology Research Institute. Like so, Incheon aims to makethe City a national strategic base for the connected car industry.



▲ The City has alsoestablished a full-cycle support system for the conversion to future cartechnology and technological advancement of small and medium-sized automobileparts companies.

Moreover, the City hasalso established a full-cycle support system for the conversion to future cartechnology and technological advancement of small and medium-sized automobileparts companies. Incheon is promoting a tear-down project that dismantles thelatest global electric vehicles to analyze the technical structure of parts andprovide core technology information to parts companies that are not ready for amajor technology conversion. The project will share the latest technologyinformation with these companies to kick-start their transition.


Aside from this, Incheonis focused on offering consulting services on setting the direction of futurecar technology conversion and establishment of investment plans, professionaltraining for incumbents, research and development support, and technologyroadmap research services as well.

The City plans toeffectively respond to the paradigm shift of global future vehicles such aselectric vehicles, autonomous driving vehicles, and connected cars in Incheon'sauto parts industry, which remains largely focused on ICE vehicles, bysupporting the development of the future car parts industry. Furthermore,Incheon has a plan to pioneer the technological innovation of parts companiesby expanding its projects supporting the technology conversion for future cars.

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