South Korean regulators have fined Mercedes-Benz after a major disclosure issue. The action is linked to the Mercedes sales guideline case involving electric vehicle battery information. Authorities say the company misled buyers about battery suppliers. As a result, the fine reached 11.2 billion won, or about $7.6 million.
The decision came from the Korea Fair Trade Commission. Officials believe internal sales documents created confusion for dealers and customers.
What Triggered the Investigation
The issue began with internal sales guidelines shared with dealerships. These documents suggested all EQE and EQS vehicles used batteries from Contemporary Amperex Technology Co. Limited. That company, often called CATL, is the world’s largest EV battery maker. However, regulators discovered that some vehicles used cells from Farasis Energy.
The guidelines failed to mention this difference. Therefore, dealers and buyers believed all vehicles used CATL batteries. According to investigators, this omission misled customers during the sales process.
Market Context and Industry Impact
Battery suppliers matter in the electric vehicle market. Performance, safety perception, and brand trust often depend on them. For example, CATL controlled about 39% of the global EV battery market in 2025. This data comes from industry tracker SNE Research. In contrast, Farasis did not rank among the world’s top ten suppliers. Because of this gap, supplier transparency becomes even more important. Consequently, regulators viewed the missing disclosure as a serious consumer issue. The investigation gained urgency after a fire incident in 2024. A vehicle caught fire in an underground parking area in Incheon. Authorities later found the battery cell came from Farasis. That discovery pushed regulators to review the sales guidelines more closely. Investigators then traced the issue back to the internal documents.
Fine and Legal Consequences
Officials estimate that about 3,000 vehicles carried the Farasis battery cells. These cars were sold between June 2023 and August 2024. Total sales from those vehicles reached roughly 281 billion won. The regulator imposed a penalty equal to about 4% of those sales. That amount represents the maximum allowed under the law. In addition, authorities plan to refer both the German headquarters and the local unit to prosecutors. Regulators say both sides played roles in preparing and distributing the sales guidelines. As a result, the Mercedes sales guideline case may lead to further legal scrutiny.
