[Anchor]
It is time for our "Friendly Economy" segment on Friday, and reporter Han Jiyeon is here with us. Han, it seems that used car prices are going to become a bit more transparent, is that right?
[Reporter]
Yes, the government has decided to introduce a total price display system for used cars.
When dealers advertise vehicles online, they will now be legally required to show the total price, including not just the vehicle price itself, but all associated fees as well.
The used car market is quite large, with about 2.5 million transactions taking place every year.
Until now, there were many consumer complaints because the advertised prices and the actual amounts paid were vastly different.
For example,
a vehicle might be listed at 5 million won in an advertisement, but once the buyer went to sign the contract, various charges like a 440,000 won transfer fee, a 200,000 won brokerage fee, and a 500,000 won performance insurance fee would start piling up one by one, often forcing them to pay over 1 million won extra.
That is why the government decided to step in.
From now on, advertisements must display the total price encompassing all fees.
This works in a similar way to buying airline tickets.
In the past, airline tickets were heavily marketed with just the base fare, like "special price of 50,000 won," while fuel surcharges and taxes were only revealed right before payment.
To prevent that practice, a total price display system was introduced for airline tickets back in 2014, and the same principle has now been applied to the used car market.
[Anchor]
I also heard that getting a refund is going to become a bit easier, correct?
[Reporter]
Until now, consumers could only get a refund if they could prove that the actual condition of the car differed from what the dealer had stated.
Going forward, buyers will be able to get refunds even if major components simply suffer serious defects.
You know how sometimes strange noises come from the engine right after buying a used car.
From now on, if a major component like the engine develops a defect within seven days of purchase and the repair burden is too heavy, the contract can be canceled altogether.
This time, the government has decided to clearly hold used car dealers accountable for warranty repairs in alignment with civil law and standards in other countries.
There are specific criteria for what constitutes a "heavy repair burden."
If repair costs are 3 million won or more and simultaneously account for 30 percent or more of the purchase price, or if the repair period takes 30 days or longer, meeting either of these conditions will serve as grounds for contract cancellation.
And there is another change as well.
Until now, consumers have had to bear the cost of insurance required during performance inspections.
This insurance premium has jumped 2.2 times over the past five years.
Criticism had also arisen that the insurance itself was managed loosely.
Consequently, the government has decided to integrate this performance insurance into a mandatory policy held by dealers, while stating that it will lower the insurance burden by expanding coverage periods and items.
[Anchor]
Does that mean selling a flood-damaged car by mistake could land someone in serious trouble from now on?
[Reporter]
While it used to be possible to brush it off by claiming it was a mistake, in the future, business suspension will be possible regardless of whether there was intent.
More than 80 percent of complaints regarding used cars stemmed from poorly prepared inspection records.
Cases often involved cars that had been flooded lacking flood history records, or missing accident histories.
As for why these records were so poor,
the performance insurance introduced in 2019 diminished the necessity of conducting thorough inspections because people thought, "Even if a defect occurs, it will be covered by insurance anyway."
Furthermore, there were loopholes allowing sellers to get away by claiming it was "not intentional," and the inspection record format itself was outdated, designed for older vehicles.
Detailed inspection criteria and the basis for penalties were also ambiguous.
Therefore, in the future, incorrectly recording critical items such as flood or accident history will immediately trigger business suspension penalties without the excuse of "I didn't know."
Not only will penalties become stricter, but the inspection record format will also be revamped to suit modern cars, and new detailed inspection guidelines will be established.
In addition to this, consumers will be able to check in advance which businesses are trustworthy.
Reliability information for dealers and performance inspectors will be disclosed annually, and "exemplary business operators" will be designated separately based on this data.
Widely used "sell my car" platforms are also being overhauled.
Previously, even if a platform misdiagnosed a car and caused financial damage to dealers or vehicle owners, small-scale dealers reportedly could not properly lodge complaints out of fear of having their accounts blocked.
Going forward, if platforms make incorrect diagnoses, they must compensate for the actual amount of damage incurred, and blocking service access without user fault will be prohibited.
The Ministry of Land, Infrastructure and Transport previously lacked even the legal basis to levy fines on such platforms.
Now, the Minister of Land, Infrastructure and Transport will be directly empowered to impose administrative fines.
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