SEOUL, April 22 (AJP) — After dominating the rechargeable bus market, smaller electrified four wheels of Chinese origin are rapidly proliferating on South Korean roads.
Chinese brands accounted for 33.9 percent of Korea's electric vehicle market in 2025, up sharply from 4.7 percent in 2022, according to a report presented at the Automobile & Mobility Industry Development Forum hosted by the Korea Automobile & Mobility Industry Association (KAMA) in Seoul.
Over the same period, the share of domestically produced EVs fell from 75.0 percent to 57.2 percent, underscoring a rapid shift in market dynamics.
The trend has accelerated further this year. In the first quarter, sales of Chinese EVs surged 286.1 percent from a year earlier to 25,000 units, outpacing the 126.1 percent increase in domestic EV sales, which reached 51,000 units.
“Competition with low-priced Chinese EVs is intensifying in the domestic market,” KAMA Chairman Jung Dae-jin said. “A weakening production base could lead to a contraction of the broader industrial ecosystem and, in the long term, the hollowing out of domestic manufacturing.”
Industry officials warned that the impact could extend beyond automakers, given the sector’s tightly integrated supply chain.
“Erosion of the domestic production base could undermine the parts industry and affect employment stability,” said Lee Taek-sung, chairman of the Korea Auto Industries Coop. Association (KAICA), calling for tax incentives to support local manufacturing.
Experts said China’s edge is expanding beyond pricing into next-generation vehicle technologies.
“Chinese EVs combine strong cost advantages with rapid progress in technologies such as software-defined vehicles and autonomous driving,” said Cho Chul, a senior researcher at the Korea Institute for Industrial Economics and Trade. He called for coordinated efforts by the government, industry and labor to lower domestic production costs through R&D support, tax incentives and infrastructure investment.
Major economies have already adopted production-linked support measures. The United States has introduced incentives under the Inflation Reduction Act, Japan has incorporated EVs into its domestic manufacturing tax credit schemes, and the European Union has rolled out the Net-Zero Industry Act.
“Without a comparable framework, there is a real risk that Korea’s global competitiveness will erode,” said Song Dong-jin, managing partner at The Wiz Law Firm, urging tax credit programs to encourage companies to maintain production onshore.
Copyright ⓒ Aju Press All rights reserved.
