Sales of Hyundai and Kia’s battery electric vehicles (BEVs) in South Korea are declining due to reduced subsidies, higher charging costs, and increased competition from imported car brands.
In September, Hyundai saw a significant decline in electric vehicle (EV) sales, with a decrease of 30% compared to the previous year. This decline stands out even more as Hyundai’s overall domestic sales increased by 12.9% during the same period.
Sales of Hyundai’s Ioniq 5, Ioniq 6 models saw significant decline last month. Sales of the Ioniq 5 dropped by 46.9% year-on-year to 1,061 units, the Ioniq 6 sales were down 18% to 400 units compared to July.
In the past month, Genesis, Hyundai’s luxury brand, saw a significant drop in sales for their electric sedan and SUV models. The Genesis G80 Electrified sold only 68 units, a 74% decrease compared to the same period last year. The electric SUV models, GV60 and GV70, also experienced declines of 51.2% and 71.6% in sales respectively.
In August, Kia experienced a notable decrease in sales for its electric SUV models. The EV9 saw a significant drop in sales, declining from 1,251 units in July to 408 units.
The decline in Hyundai and Kia’s EV sales is due to reduced subsidies and increased charging fees, making owning an EV less cost-effective. The EV subsidy was cut by 1 million won ($749 USD) this year and will be reduced further next year. Public EV charging fees have also increased and are expected to rise even more.
Hybrid Electric Vehicles (HEV), electric battery cars which also have a internal combustion engine, and Plug-in Hybrid Electric Vehicles (PHEV), hybrids that can be fueled with gasoline for internal combustion engines & electrically charged via a plug-in cable are gaining popularity as both offer a combination of internal combustion engines and electric motors; resulting in reduced emissions, no requirement for electric charging, and improved fuel efficiency.
Hyundai and Kia experienced a significant increase in hybrid car sales, with Hyundai’s sales soaring by 153.4% and Kia’s Sorento hybrid being the top-selling model last month.
Hyundai and Kia face a challenge due to the rising sales of imported electric vehicle brands. The number of imported EVs sold in South Korea increased nearly tenfold from 2019 to 2020, surpassing 12,000 units as of July this year.
Some imported car brands are currently offering discounts on their electric vehicle models. For instance, the 2023 Mercedes-Benz EQE has a discount of 13-15 million won ($9,732 – 11,230 USD), while the 2024 BMW i4 offers a discount of 8-14 million won ($6,000 – 10,480 USD).
