On Feb. 7, Bloomberg reported that Tesla sold only one unit of the Model Y in Korea in January, citing Korean market research firm CarIsYou and government data.
The growth of the electric vehicle market in Korea slowed as high interest rates and inflation have kept consumers from spending, while concerns about battery fires and a shortage of quick chargers stifled demand, Bloomberg analyzed.
Early adopters already purchased electric vehicles, while general consumers did not consider buying them in Korea, Bloomberg said, citing automotive industry experts. Some consumers were also concerned about manufacturing quality after realizing that some Tesla vehicles were made in China, the report added.
Some analysts believe that the drop in EV sales in January, especially in the Korean market, is related to subsidies for EV buyers. They say that EV buyers tend to hold off on EV purchases in January to wait for the Korean government’s EV subsidy announcement in February. Across all manufacturers including Tesla, the number of new EVs registered in Korea in January was down 80 percent from the previous month.
Going forward, Tesla’s sales may be further hit by changes to electric vehicle subsidies that the Korean government proposed on Feb. 6. Tesla boosted sales of its Model Y rear-wheel drive loaded with LFP batteries from China’s CATL in September last year by lowering the price below 57 million won, the threshold for full government subsidies, to 56.99 million won (US$42,764). However, this year’s 100 percent subsidy is limited to vehicles priced below 55 million won, raising speculation that Tesla’s Model Y subsidy will be cut in half, which may affect the model’s sales.