Korea stalls at the threshold of autonomous driving
As Tesla expands self-driving software access, Korea faces growing pressure to clarify rules that leave many owners without features they already paid for.
Tesla demonstrates its “supervised Full Self-Driving (FSD)” system on the streets of central Seoul in footage released by the company.Tesla X
Lee Chul-min
The author is the managing partner of VIG Partners.
In late June, Tesla began rolling out “V14 Lite” in the United States, an optimized version of its latest Full Self-Driving, or FSD, software designed to run on older Hardware 3 systems. The announcement followed the introduction of supervised FSD in some Tesla vehicles in Korea last November, raising expectations among owners here.
Tesla’s FSD availability in Korea is now divided into three categories depending on where vehicles were built and which certification standards apply. Under the Korea-U. S. FTA, some U.S.-made models, including the Model S and Model X, can use V14 because they comply with U.S. safety standards. U.S.-built Model 3 and Model Y vehicles equipped with older HW3 systems also became eligible after Tesla began the global rollout of V14 Lite on Friday.
The outlook is far less certain for China-made Model 3 and Model Y vehicles, which account for most Tesla sales in Korea. Because Korean vehicle safety standards incorporate European rules, and because separate certification issues remain unresolved, it is difficult to predict whether or when FSD will be permitted.
The regulatory divide has become increasingly difficult to justify publicly.
This contradiction is evident in a class-action lawsuit filed by some owners who paid more than 9 million won for the FSD option but cannot use it simply because their cars were produced in a different country. Their grievance is not merely about a delayed feature. It concerns a regulatory structure that allowed the same option to be sold while leaving access dependent on standards most buyers could hardly be expected to understand.
At the heart of the problem are international standards governing autonomous-driving technology. Driver Control Assistance Systems, or DCAS, are covered by international rules for supervised driving in which the driver remains responsible and must continue monitoring the road. After a UN body approved revisions on June 26, industry observers said Korea could no longer postpone the debate over how those standards should be incorporated domestically.
Controversy intensified on July 7 when a media report said the Ministry of Land, Infrastructure and Transport viewed Tesla’s FSD as closer to conditional automation, or Level 3, than supervised driving and had decided to exclude it from DCAS rules.
The ministry immediately denied the report. At the same time, however, it maintained that the timetable for expanding FSD use remained undecided. In other words, the government does not classify the system as Level 3, but neither has it committed to allowing broader use. Its clarification removed one interpretation without resolving the underlying question confronting manufacturers and consumers.
Two conflicting arguments lie behind the dispute. One says Hyundai Motor and Kia should be given time to strengthen their competitiveness. Under the Korea-U. S. FTA, Tesla can sell qualifying vehicles in Korea without undergoing separate certification, while Hyundai and Kia must obtain new domestic safety approval no matter how advanced their autonomous-driving technology becomes. From this perspective, immediate liberalization could create an uneven playing field favoring an overseas competitor already benefiting from treaty provisions.
The opposing view is that Korea should open its market immediately to advanced technology and use competition to accelerate innovation. This is the so-called catfish effect: exposure to a formidable rival can push domestic companies to improve more quickly. Shielding Korean automakers may buy them time, but it could also weaken the pressure needed to develop better systems and bring them to market.
The greatest problem, however, is that prolonged uncertainty benefits no one. Tesla buyers who have already spent substantial sums are likely to direct their frustration not only at the government but also at Korean automakers. Domestic companies also cannot plan effectively when regulators decline to state clearly which technologies will be accepted, under what conditions and according to what timetable.
“Undecided” is not a decision. It is merely a postponement. Korea is standing at the threshold of the autonomous-driving era, but instead of choosing a direction, it remains frozen there.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
