Market share of domestic cars declines amid surge in imported electric vehicles… Market polarization expected to continue

*This content was translated by AI.

Although the domestic automobile market appears to show slight growth this year, a 'mirage phenomenon' where imported electric vehicles are compensating for the slump in domestic cars, alongside deepening 'polarization,' is intensifying.

According to new vehicle registration data from the Ministry of Land, Infrastructure and Transport, institutional investors, and the Korea Association of Imported Automobiles (KAIDA), total domestic car sales from January to May this year reached 687,912 units, a 1% increase compared to the same period last year. Among them, domestic car sales totaled 533,854 units, a 5.2% decrease compared to the same period last year, while imported car sales rose 30.9% to 154,058 units.

The polarization phenomenon was even more pronounced in May's results. New domestic car registrations in May fell 20.5% year-on-year to 91,958 units. Major domestic passenger car brands, including Kia (down 11.5%) and Hyundai Motor (down 26.9%), which rank first and second, as well as Genesis (down 45.2%) and Chevrolet (down 50.7%), all showed double-digit declines. Hyundai Motor reduced production due to disruptions in parts supply.

The imported car market recorded a 5.1% increase to 32,901 units during the same period. The key driver behind the growth of the imported passenger car market is imported electric vehicles. In May, new registrations of imported passenger cars totaled 29,860 units (based on KAIDA data), with electric vehicles accounting for the largest share at 48.6% (14,520 units) by fuel type. HYBE Rides accounted for 40.4%.

US-based Tesla and China's BYD led the market by leveraging price competitiveness. Tesla sold 18,666 units in May alone, ranking first among imported passenger car brands. The Tesla 'Model Y' sold 8,762 units in May alone, surpassing the total sales of the BMW brand (6,555 units). Tesla lowered its price to 49.99 million won, which falls within the subsidy eligibility range.

BYD sold a cumulative 7,023 units this year, rising to seventh place among imported car brands. With the 20th-million-won-class compact electric vehicle 'Dolphin' and the 40th-million-won-class mid-size SUV 'Sealion 7' at the forefront, it is threatening the mass-market defense line of domestic cars.

The crisis in the domestic car industry is growing due to the all-out offensive of imported electric vehicles. An industry official stated, "Imported car brands are changing the standards of the domestic electric vehicle market through aggressive pricing and diversification of mid-to-low-priced LINE-ups."

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*This content was translated by AI.