This year's imported car sales are on the verge of surpassing 300,000 units for the first time. With the market share also likely to break 20%, some say the era of mass adoption of imported cars has arrived. But analysts note that the outlook remains cloudy, as BMW, Mercedes-Benz and Tesla account for two-thirds of the entire market, showing clear concentration, and competition is intensifying with the entry of Chinese brands.
According to the Korea Automobile Importers & Distributors Association (KAIDA) on the 22nd, the cumulative number of newly registered imported cars from January to November this year was 278,769, up 16.3% from the same period a year earlier. Considering that 230,000 to 290,000 units were registered every December over the past four years, expectations are that the total will readily climb to the 300,000 level by year-end. This is the first time since related statistics began in 1987; the previous record high was 283,435 units set in 2022.
In terms of market share, a first-ever break above 20% is also all but certain. It stood at 15.9% to 18.9% only from January to April at the start of the year, but it posted in the 20% range from May through October. With November new registrations surging 22% on-year and December being a period when year-end promotions concentrate, market share in the remaining period is also expected to post a solid level.
Compared with 1987, the first year Korea opened its imported car market, when imported cars numbered just 10 (0.004%) out of all newly registered vehicles (249,458), the growth is remarkable. However, compared with how it took only four years to break 200,000 after first exceeding 100,000 in 2011, reaching 300,000 has been somewhat arduous.
Although an era has opened in which one out of every five cars is an imported model, sentiment in the imported car industry is not that bright. The fruits of growth are not shared evenly. There are 26 brands included in the imported car statistics, and among them, the top three—BMW (70,541 units), Mercedes-Benz (60,260) and Tesla (55,595)—account for 66.9% of all new registrations. As for the other 23 brands, their sales through November this year are, at best, in the low 10,000s.
Competition is also getting fiercer. In 2022, Swedish electric vehicle brand Polestar entered Korea, and in January this year, China's BYD, the world's largest electric vehicle company, came into Korea with the Atto 3, Seal and Sea Lion 7. Next year, Zeekr, the premium electric vehicle brand of China's Geely Automobile, plans to roll out new cars in earnest, and China's Xpeng has also signaled an entry into Korea.
A person in the imported car industry said, "Each company may say it pursues a different image, but unless it is an ultra-luxury brand, they ultimately have no choice but to compete for a similar target," and added, "The overall imported car market has grown, but it is hard to say the business environment has improved." In fact, the first vehicle Zeekr will launch in the Korean market is known to be the 7X, a midsize electric sport-utility vehicle (SUV). Competing models in the same class from many brands include BMW's iX3, Volvo's EX60 and BYD's Sea Lion 7.
Some imported brands have moved to clear inventory at the end of the year and secure market share through promotions. Honda Korea offers either 2 million won in fuel costs or low-interest financing for up to 60 months when purchasing the Accord Hybrid midsize sedan. Cadillac is offering a 17 million won cash discount and a 60-month zero-interest installment promotion for the Lyriq electric SUV, while Tesla, in collaboration with Samsung Card, offers 36-month zero interest for the Model 3 RWD and low-interest financing for up to 60 months for the Model Y and others.