Chinese EVs make inroads in South Korea, one of world’s most competitive auto markets

Chinese-manufactured electric vehicles (EVs) have made dramatic inroads into South Korea, one of the world's most competitive auto markets, with their market share surging from just 4.7% in 2022 to 33.9% in 2025. Sales of China-made EVs in South Korea soared to 25,000 units in the first quarter of 2026, a 286.1% increase from the same period last year, according to data from the Korea Automobile and Mobility Association (Kaida). Over the same period, Korean carmakers sold about 51,000 units but grew at a much slower pace of 126.1%, as their market share slid from 75% to 57.2%.

The biggest driver of this growth isn't a Chinese brand but Tesla, whose Shanghai-built models have become increasingly popular. Tesla sells its models in South Korea with slightly lower specifications—including a shorter driving range and smaller battery capacity than U.S.-made versions—while cutting prices by as much as 10 million won (US$6,740). Tesla's sales jumped 311% from 2022 to 2025, reaching 59,916 units, making it South Korea's bestselling imported brand in Q1 2026. Chinese brands like BYD are also gaining traction, with BYD becoming one of Korea's fastest-growing imported EV brands, while rivals like Chery look to break into the market. Analysts say higher fuel prices linked to the US-Israeli war in Iran and looser restrictions than traditional target markets provide tailwinds, but tightening subsidy regimes could slow expansion.