Tesla’s Model Y and BYD Dominate South Korea’s Imported EV Market in 2025
South Korea's electric vehicle market just got a new power duo—and they're both imports.
The 2025 numbers are in, and the story isn't about domestic giants. It's about two foreign brands that sliced through local loyalty and rewrote the rulebook. Tesla's Model Y and China's BYD didn't just enter the market; they took over the conversation.
How the Outsiders Won
Forget gradual adoption. This was a targeted takeover. Analysts point to a perfect storm: aggressive pricing that undercut established players, a charging infrastructure that finally caught up to ambition, and a consumer base tired of waiting for the home team to innovate. The Model Y became the default choice for tech-forward buyers, while BYD's value proposition carved out a massive segment of cost-conscious converts.
Local manufacturers are scrambling. Their playbooks, built on decades of domestic dominance, look suddenly outdated. The imported EVs offered something Korean brands struggled to match: a complete ecosystem wrapped in a brand narrative that resonated globally. It wasn't just about the car; it was about buying into a movement.
The Ripple Effect
The impact stretches far beyond dealership lots. Supply chains are pivoting. Policy makers are re-evaluating subsidies and trade frameworks. The entire economic calculus for Korea's auto sector—a cornerstone of its export economy—is being recrunched overnight. It's a stark lesson in how quickly global trends can bypass national borders.
One veteran industry watcher put it bluntly: 'The market voted with its wallets. All the government incentives in the world can't compete with a product people actually want to buy—a concept some local boardrooms are still treating as a radical theory.'
So, what's next? Consolidation, partnerships, or a fierce counter-attack? One thing's certain: the race for South Korea's roads is no longer a local affair. The finish line just got a lot more crowded.
Price cuts and affordability drive Tesla, BYD EV surge
Tesla’s Model Y and BYD’s Atto 3 increased the demand for foreign EVs, especially among younger consumers. According to the Chosun Daily, a local news outlet, Tesla rapidly penetrated the SK domestic market by significantly reducing prices of producing the Model Y at its Shanghai factory in China.
Tesla unveiled the base Model Y in 2023. It was priced around 20 million Korean won, or around $15,385, cheaper than previous models.
Tesla reduced the price by 20 million Korean won, or around $15,385, to around 49,990,000 Korean won ($38,453) by the end of last year. This happened after Tesla equipped the vehicle with Chinese-made lithium-iron Phosphate (LFP) batteries and reduced the specification from dual motors to single motors.
Regarding the Chinese BYD, last year it introduced several affordable electric car models, including the Atto 3, with 3,076 units. Following the successful debut of the affordable Atto 3, the business launched the Seal with 369 units, then the mid-size SUV Sealion 7, which sold 2,662 units in just four months, spurring further expansion.
The Chosun Daily, a local news outlet, reported that the Atto 3, which is usually priced at 30 million Korean won ($23,000), may be bought for as little as 20 million Korean won ($15,400) with subsidies, significantly increasing customer accessibility.
BYD increased its market share by focusing on price competitiveness. As a result of price competitiveness, BYD became the second-largest brand in imported electric vehicle sales within a year of entering the South Korean domestic market. The business currently runs 16 service facilities and 28 showrooms across the country.
SK imported car market shifts as EVs surge, hybrids dominate
On January 12, the South Korea Automobile Importers & Distributors Association (KAIDA) reported that passenger car registrations by fuel type for 2025 totaled 91,253, a significant 84% increase from the year before. EVs accounted for 30% of the total 307,377 imported cars sold in SK.
On January 17, The Asia Business Daily, a local news outlet, reported that in the same time frame, there were 174,218 hybrid cars (including plug-in hybrids), accounting for 56% of the market. Nevertheless, this was only a 5 percentage point rise over the 51% from the prior year.
The report noted that sales of internal combustion engine cars drastically decreased as the eco-friendly trend overtook them. Only 12% of the market was gasoline-powered vehicles, which fell to 38,512 units, a 62% decline from 62,671 units the year before. Just 3,394 diesel cars were sold in South Korea, accounting for hardly 1% of the market.
According to the report, the market for imported automobiles is expected to see numerous new electric vehicles introduced this year. BYD is expected to introduce the compact electric hatchback “Dolphin,” which completed domestic certification in October of last year. However, because the domestic small hatchback market has not expanded as expected, the business intends to set the launch date strategically.
Join a premium crypto trading community free for 30 days - normally $100/mo.
