The share of China-produced electric vehicles in the domestic auto market has surpassed 30%. Vehicles leveraging price competitiveness are rapidly spreading, shifting the market’s center of gravity. As a result, the competitive landscape is being reorganized from a brand-centered structure to one driven by pricing.
Electric vehicles from Zeekr awaiting shipment. / Zeekr
These changes are also evident in market indicators. In particular, in the EV segment, market share has expanded rapidly over the past two to three years, increasing its influence.
In fact, out of 220,177 newly registered electric vehicles in 2025, 74,728 were produced in China, accounting for 33.9%. This marks a sharp increase from just 7.5% in 2023. The rise is attributed to a combination of increased sales by Chinese brands and a growing influx of EVs produced at Chinese factories and imported into Korea.
On the other hand, the share of domestically produced EVs declined from 75% in 2020 to 57.2% in 2025. German-brand EVs also remained in the 7% range, signaling changes in the traditional import-car-centered structure. The shift in market share is also leading to a reshuffling of sales rankings.
The expansion of China-produced EVs is effectively being led by Tesla. Increased imports from its Shanghai factory have significantly boosted sales in the Korean market. In particular, the company has sustained its growth by expanding supply of mid-size SUVs, which are in high demand.
According to the Korea Automobile Importers & Distributors Association (KAIDA), Tesla Model Y sales reached 50,405 units in 2025. Considering Tesla’s total sales of 59,916 units during the same period, Model Y accounted for the majority. In March alone this year, Tesla sold 11,130 units, becoming the first import brand to surpass 10,000 monthly sales.
BYD is also rapidly increasing its presence. Since entering the Korean market in April 2025, it has sold 10,078 units by March this year, reaching 10,000 units in just 11 months. This compares to seven years for BMW and three years for Mercedes-Benz to reach the same milestone.
Industry experts cite price competitiveness as the key driver behind the expansion of China-produced EVs. Compared to domestic and German brands, these vehicles are entering the market at relatively lower price points, quickly broadening the customer base.
In fact, the Tesla Model Y’s price dropped from the 90 million won range to the 50 million won range after the introduction of China-produced units. BYD has expanded its lineup with models such as the Atto 3, Dolphin, and Sealion 7, with the Dolphin priced in the 20 million won range after subsidies, attracting demand. Volvo Car Korea has also joined the competition by cutting the price of its China-produced compact electric SUV EX30 by up to 7.61 million won.
The industry believes that the EV market is shifting from an initial focus on performance and brand to one that prioritizes price and practicality. In this transition, China-produced EVs, which offer relatively strong price competitiveness, are rapidly expanding their market share and disrupting the existing competitive structure.
An official from the import car industry said, “The EV market is rapidly shifting from performance-driven to price-driven competition,” adding, “The rise in Chinese EV share is the most direct result of responding to this change.”
Model Y. / Tesla
In response to changing market dynamics, the government is also considering adjustments to EV subsidy policies. Starting in the second half of the year, it is reviewing measures to reflect manufacturers’ contributions to the domestic industry and investment levels in subsidy eligibility criteria. Under such changes, imported EVs with low domestic production shares may be placed at a relative disadvantage. In particular, Chinese brands and Tesla, which have limited contributions to the local industry, could face exclusion from subsidies or reduced support.
Some analysts suggest that the revision of subsidy criteria could not only protect the domestic auto industry but also serve as a measure to curb the spread of low-priced Chinese EVs.
However, it remains uncertain whether policy changes can fundamentally alter market trends. The price-driven competitive structure that has already formed is unlikely to be reversed in the short term.
An industry official said, “While subsidy revisions may slow the pace of expansion to some extent, it will be difficult to overturn price competitiveness itself,” adding, “Ultimately, domestic automakers will have no choice but to respond on pricing.”
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