Electric vehicle demand in South Korea is recovering rapidly from the start of the year as the government's early subsidy confirmation coincides with automakers' price-cutting strategies. Competition is expected to intensify as Chinese manufacturers with strong price competitiveness enter the market in earnest.
According to Carisyou Data Research Institute, domestic EV sales reached 5,733 units last month, up 141.1% from 2,378 units in the same period last year. January is typically a slow season due to delays in national and local government subsidy confirmations, but this year the government finalized subsidy guidelines relatively early, allowing pent-up demand to flow quickly into the market.
Price reductions also stimulated demand recovery. Major manufacturers including Hyundai Motor, Tesla, and BYD lowered prices or strengthened promotions since late last year. With subsidies and manufacturer discounts expanding simultaneously, actual purchase prices for some models dropped by nearly 10 million won.
Chinese EV makers are establishing a notable presence. BYD faced expectations of limited sales due to its "Chinese car" image before entering Korea, but achieved better-than-expected results with prices starting in the low 20-million-won range. The company sold 6,017 units in its first year and recorded 1,347 units last month, ranking fifth among imported car brands.
BYD continues expanding its lineup. On the 5th of this month, it launched the Dolphin, a compact electric hatchback available for 24.5 million won. As the third model following the Atto 3 and Seal, the strategy aims to capture entry-level demand with a relatively affordable compact option.
Zeekr and Xpeng are preparing to enter the Korean market in the first half of this year, planning lineups centered on mid-size and larger SUVs and sedans. If their offensive leveraging price competitiveness and advanced features intensifies, competition with existing domestic and foreign brands will likely deepen.
The Chinese EV push is also evident in the European market. According to Dataforce, which surveyed 98% of volumes in the EU, UK, and EFTA countries, Chinese automakers' market share reached 7.4% in January—nearly double the 4.0% recorded in January last year. This gain is notable given that overall European car sales fell 3.6% year-over-year in January.
By brand, BYD and Chery showed remarkable growth. BYD sold 17,630 units, up 173% year-over-year, while Chery recorded 17,106 units, up 354%. Chery operates four brands in Europe including Jaecoo and Omoda. Geely Group sold 24,859 units, down 7.5% from a year ago, but subsidiary brands Geely (384%), Lynk & Co (183.2%), and Zeekr (264.5%) posted triple-digit growth. Sales of Leapmotor, whose overseas rights are held by Stellantis Group, also surged 409%.