After the automaker dominated the country's EV market last quarter, the South Korean government is now considering cutting Tesla out by increasing the price threshold for its generous electric car incentives, a media report said.

Electrek noted Tesla delivered over 4,000 Model 3 vehicles in Korea during the second quarter, and reportedly still has a backlog of 4,000 to 5,000 on order.

However, Tesla had so much demand that it reportedly accounted for almost half of the near US$200m in incentives the country issued during the first half of the year.

Now, the government is thinking about changing the regulations to avoid having Tesla buyers receiving the bulk of it.

According to Electrek, the Korea Herald said the ministry of environment was poised to revise the current calculation system for EV subsidies by October after discussions with municipalities, related experts and concerning associations.

High end EV brands were expected to be removed after consultations, as Tesla alone devoured 43% of total KRW209.2bn (US$176m) of subsidies in the first half of this year.

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By GlobalData

The ministry was to hold a meeting with 11 automakers, including Kia and Hyundai, to discuss the issue.

Electrek noted Tesla buyers initially were actually left out of the programme early due to a weird rule regarding charging time that unfairly put Tesla to a disadvantage.

The rule was changed later, giving Tesla buyers access to the incentives.

Electrek said EV incentives price thresholds are usually set to avoid giving subsidies to people buying luxury vehicles.

In this case, it looks like it would be triggered by Tesla's success so a threshold would have to be set especially to exclude Tesla's range.