April 14, 2012 08:06
Traffic volume is growing despite a steep hike in fuel prices since the end of last year, with the price now well over W2,000 per liter (US$1=W1,135). This undermines the received wisdom that high fuel prices would result in less use of private cars and more use of public transport.
According to Korea Expressway Corporation, the average traffic volume on expressways from December 2011 to February 2012, the period in which the fuel prices soared, was 3.77 million, 3.63 million, and 3.64 million vehicles. A year ago, the figures for the same period were 3.6 million, 3.4 million, and 3.61 million.
During this period, oil prices have gone up steadily. According to Korea National Oil Corporation, fuel prices have risen from W1,661 in January 2010 to W1,825 in January 2011 and W1,955 in January this year.
Market researchers believe that the reason is that the prices rose steadily rather than jumping abruptly. Prof. Kim Sung-soo at Seoul National University said, "Traffic volume went down visibly when the oil price increased sharply at the time of the oil shock in 2008. But although the oil price is higher now, the increase was gradual, so people were able to get used to it."
But others say it is the overall economic situation that affects traffic volume. Lee Sung-won at the Korea Transport Institute said, "We saw a 10 percent drop in traffic volume in 1998, immediately after the Asian crisis in 1997, but it has been steadily rising since then. If we don't experience a huge economic shock such as the one in 1997 or a sudden sharp increase in fuel prices, traffic volume would not fluctuate much."
Another member of the institute, Sung Nak-moon, said, "People who have their own cars in Korea are of certain economic standing, so they don't feel the need to use public transport unless the oil price goes very high."
Recent rises in bus and subway fares are also part of the reason. The Seoul Metropolitan Government raised the single fare for bus and metro from W900 to W1,050 at the end of February.
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