After Tesla sharply cut prices last month on its main sellers, the Model Y and Model 3, Hyundai Motor and Kia faced an emergency to defend the domestic electric vehicle market. On top of that, Chinese electric vehicle makers, including BYD, which entered the Korean market last year, plan to roll out new models one after another this year, likely deepening Hyundai Motor and Kia's concerns.
According to the CarIsYou Data Research Institute on the 16th, Hyundai Motor and Kia sold a combined 121,010 electric vehicles last year (including passenger cars, commercial vehicles and hydrogen electric vehicles). That was up 73.5% from 69,738 the previous year, the highest since Hyundai Motor and Kia began selling electric vehicles.
By model type, Hyundai Motor sold 46,400 passenger cars and 13,943 commercial vehicles. Kia sold 53,085 passenger cars and 7,582 commercial vehicles.
Among Hyundai Motor models, the Ioniq 5, a compact SUV, recorded the highest sales for a single model at 14,455 units. It was followed by the Porter commercial vehicle with 9,296 units, the Casper Electric (8,856 units), and the Ioniq 9 (8,208 units).
For Kia, the EV3, a small SUV, was the top seller at 21,252 units. It was followed by the EV6 (9,358 units), the Ray (9,276 units), and the EV4 (8,058 units).
However, in the auto industry, some say that while Hyundai Motor and Kia showed strong overall growth in sales, they fell short of expectations in the domestic market, pressed by Tesla's surge.
According to the Korea Automobile Importers & Distributors Association (KAIDA), Tesla sold 59,916 passenger cars in Korea last year. Even the Cybertruck, with 352 units sold, is classified as a passenger model. In the domestic electric passenger car market, Tesla's sales outpaced Hyundai Motor and Kia. In particular, the Model Y posted sales of 50,398 units last year, buoyed by the launch of the Juniper, a facelifted model.
Tesla's sales are likely to grow further this year. The price cuts carried out on the 31st of last month are drawing in EV demand.
Tesla Korea cut the Model Y Premium Long Range AWD from 63,140,000 won to 59,990,000 won, a reduction of 3,150,000 won, and the Model Y Premium RWD from 52,990,000 won to 49,990,000 won, down 3,000,000 won. The Model 3 Performance AWD price was slashed from 69,390,000 won to 59,990,000 won, a discount of 9,400,000 won.
Tesla's prices fall further when combined with this year's confirmed national subsidies. This year's national subsidy for the Tesla Model 3 is 2,000,000 won. Although local subsidies have not been finalized, assuming last year's level (200,000 won), buyers would receive around 2,200,000 won in subsidies. For the Model Y Premium RWD, if you add the 1,700,000 won national subsidy and the local subsidy, you can buy it in the high 40 million won range. In addition, switching from an internal combustion vehicle to an EV brings an extra 1,000,000 won in support.
Because of this, the import car industry says Tesla likely decided on a surprise price cut early to lock in EV buyers ahead of the annual electric vehicle subsidy calculations finalized at the start of each year.
Hyundai Motor and Kia are also in tough competition with Chinese EV makers. BYD entered the Korean market last year and launched three models: the Atto 3 small SUV, the Seal midsize sedan, and the Sea Lion 7 midsize SUV. In addition, the small hatchback Dolphin is slated for release this year.
This year's national subsidies for BYD EVs were set at 1,260,000 won for the Atto 3, 1,090,000 to 1,320,000 won for the Dolphin, 1,690,000 won for the Seal, and 1,520,000 won for the Sea Lion 7. Local subsidies have yet to be finalized, but considering that the Seoul city local subsidy was 200,000 won last year, the Atto 3's price in Seoul this year would likely be in the low 30 million won range. The Dolphin's price has not been set yet, but given that it emphasizes cost-effectiveness, forecasts say it will be released in the low 20 million won range.
Also this year, Zeekr, the premium brand of Geely Automobile Holdings, plans to begin sales in Korea. The 7X midsize electric SUV is expected to be the first model to arrive.
Hyundai Motor and Kia are responding to pressure from Tesla and BYD by discounting the prices of their core models. For Kia's EV3 Long Range, if you add the 5,550,000 won national subsidy, local subsidies, and Kia's discount, you can buy it in the high 30 million won to low-to-mid 40 million won range.
For the Ioniq 6, the national subsidy is 5,700,000 won. Adding Hyundai Motor's own discount program (1,000,000 to 5,500,000 won) and the EV conversion support brings the maximum discount to 12,200,000 won. Based on the Ioniq 6 Long Range, you can buy it in the mid-40 million won range. The Ioniq 5 is also expected to be in the mid-40 million won range.
For now, prices of Hyundai Motor and Kia's main EVs are cheaper than comparable Tesla models, but the gap does not exceed 10,000,000 won. Because of this, many in the auto industry say Hyundai Motor and Kia need to consider more aggressive discounts to capture new EV buyers.
Some also argue that Hyundai Motor and Kia need to further broaden their EV lineups. For Hyundai Motor, three dedicated EV models are on sale: the Ioniq 5, Ioniq 6 and Ioniq 9. The Ioniq 3, a small SUV, remains in the conceptual stage.
An auto industry official said, "Of the new cars Hyundai Motor is launching this year, the majority are hybrids and plug-in hybrids, which could make it even harder to compete in the EV market against Tesla and BYD."