[THE INVESTOR] The food trucks business appears to be falling short of the economic effects that the government hoped for, with less than one-third projected vehicles on the roads, data showed on March 8.
The government revised regulations to allow food trucks in September 2014 as part of its deregulation plans aimed at boosting the economy. At the time, the government touted food trucks as a low-cost business for young entrepreneurs.
Seoul Mayor Park Won-soon (second from left) attends a promotional event for foodtrucks in this 2015 file photo.
However, their viability appears to have been overestimated, with the number of closures far outpacing new business registrations.
According to Seoul city government, 33 new food trucks began operations in the final quarter of last year, while 65 shut down. In the third quarter of 2016, however, 98 food trucks opened while 19 closed down.
With new openings dwindling, only 312 of the 1,000 trucks modified as mobile kitchens were in operation at the end of January, according to Ministry of Food and Drug Safety.
The rise in food trucks going out of business is thought to have been fueled by the lack of foot traffic during the winter months.
In addition, Seoul says that many operators target various events organized by local governments and close down in the final quarter of the year when such events become scarce.
By Choi He-suk (email@example.com)