Korean Media: South Korea Both Loves and Fears China's Electric Vehicle Surge

According to a report by Korean media outlet JoongAng Ilbo (Japanese edition) on April 15: The momentum of Chinese automobiles targeting the South Korean market is extremely strong. Whether it's Chinese brands or vehicles manufactured in China, they have successfully captured the attention of South Korean consumers.

There are also forecasts suggesting that rising oil prices due to the war in the Middle East will accelerate the adoption of cost-effective Chinese-made electric vehicles in South Korea.

Data provided by BYD (Korea) shows that cumulative passenger vehicle sales by BYD in South Korea have exceeded 10,000 units, reaching 10,075 units by March. BYD (Korea) delivered its first vehicles to customers in South Korea on April 14 last year, selling 10,000 units within 11 months. 79% of customers were individuals, with those aged in their 40s to 50s accounting for 65%. Analysts suggest that middle-aged and older customers prioritize cost-effectiveness and practicality over young white-collar workers' need for a "first car."

BYD’s sales growth momentum has been accelerating. In 2023, BYD sold 6,107 units within eight months, but in the first three months of this year alone, sales reached 3,968 units. A manager at BYD (Korea) told reporters: “Selling 10,000 units within 11 months set a record for the fastest import car sales achievement. Our goal is to achieve 10,000 units in sales this year.”

BYD (Korea) currently sells four models, including the newly launched “Dolphin,” following last year’s “AT 3,” “Seal,” and “Sea Lion 7.” A plug-in hybrid model is also planned for release later this year.

The surge of Chinese-made electric vehicles is astonishing. According to data from the Korea Automobile Mobility Association (KAMA), the number of newly registered electric vehicles in South Korea last year totaled 220,177 units. Among them, 74,728 vehicles were manufactured in China, accounting for 33.9% of total sales—meaning one-third of all newly registered EVs in the country come from China. The biggest contributor is Tesla’s Model Y, produced in China and sold in South Korea.

KAMA noted: “Producing in China has lowered Tesla’s pricing, while South Korea remains cautious yet attentive toward Chinese brands like BYD and Polestar.”

Recent high fuel prices are likely to further drive the expansion of Chinese electric vehicles in the market. A report released by the Bank of Korea on the 10th titled “Analysis of Main Drivers Behind Growth in China’s Automotive Industry” predicts that due to the Middle East war and soaring oil prices, demand for electric vehicles will increase. The report states: “During the 1970s oil crisis, when oil prices rose, demand shifted from medium- and heavy-sized cars to smaller ones. Japan, as a nation with strong compact car manufacturing capabilities, became the world’s top automobile producer at that time. In response to the growing presence of Chinese-made electric vehicles, South Korea’s Ministry of Climate and Environment will begin scoring automakers starting this year—regardless of vehicle type. If an automaker fails to score at least 80 points out of 120, it will not qualify for subsidies. Evaluation criteria include technological development, after-sales management, and industrial contribution. These metrics aim to assess R&D investment, patent ownership, maintenance network construction, support for domestic parts manufacturers, and local parts procurement.”

A government official responsible for imported vehicles stated: “Since patents belong to headquarters and components are produced overseas, this scoring system puts imported electric vehicles at a disadvantage.”

In response to parliamentary concerns, Minister of Climate and Energy Environment Kim Seong-hwan said: “Subsidies are essentially taxes, intended to contribute to protecting domestic industries.”

Original article: toutiao.com/article/1862507617115148/

Disclaimer: The views expressed in this article are solely those of the author.