- South Korea’s regulator fined Mercedes-Benz 11.2 billion won for misleading EV battery supplier information.
- The case highlights growing global scrutiny over transparency in electric vehicle battery sourcing.
The Mercedes-Benz EV battery supplier disclosure case has drawn regulatory action in South Korea, where authorities fined the automaker 11.2 billion won ($7.61 million) for misleading consumers about battery suppliers used in certain electric vehicles. The Korea Fair Trade Commission (FTC) determined that the company’s communications to dealers created an inaccurate perception about the battery technology installed in some EV models.
The regulator also ordered corrective measures related to sales and marketing practices and announced that it would refer the matter to prosecutors. These actions highlight the increasing importance regulators place on transparency surrounding electric vehicle battery sourcing and supplier information.
Investigation Into Dealer Sales Guidelines
The FTC investigation focused on internal sales documentation distributed by the automaker to its dealer network. According to findings reported by Reuters, the guide indicated that electric vehicle models were equipped with battery cells produced by Contemporary Amperex Technology Co. Ltd. (CATL), currently the world’s largest EV battery manufacturer.
However, investigators determined that some vehicles were actually fitted with battery cells supplied by Farasis Energy. This information was not included in the sales guide and was not communicated to dealers or customers during the purchasing process.
Market Position of the Battery Suppliers
The difference in industry standing between the two suppliers contributed to the regulatory concern. Industry data from SNE Research showed that CATL accounted for approximately 39% of the global electric vehicle battery market in 2025, while Farasis Energy did not rank among the world’s top ten suppliers.
By highlighting CATL’s credentials without clarifying that some vehicles used cells from another supplier, regulators concluded that the marketing materials could influence consumer decisions by presenting incomplete information.
Scale of Affected Vehicle Sales
The commercial scope of the issue was significant. Roughly 3,000 vehicles equipped with Farasis battery cells were sold between June 2023 and August 2024 in the South Korean market. Total sales related to those vehicles were estimated at around 281 billion won.
The 11.2 billion won penalty represents about 4% of the affected sales value, which authorities indicated was the maximum fine permitted under existing competition law for unfair business practices.
Regulatory Action and Industry Implications
South Korea’s regulator stated that both the German headquarters and the Korean subsidiary were involved, directly or indirectly, in preparing and distributing the sales guidance. As a result, both entities will jointly pay the financial penalty while prosecutors review the case following the FTC referral.
The automaker acknowledged the regulator’s decision but stated that it disagreed with the final ruling. Despite that response, the case signals stricter enforcement expectations for manufacturers operating in the rapidly expanding electric mobility sector.
Authorities emphasized that information affecting purchasing decisions — particularly when it relates to safety-sensitive technologies such as EV batteries — must be clearly and accurately disclosed to maintain consumer trust in the evolving electric vehicle market.
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