EV Sales Increase 23% in H1 of 2020
Sales of electric vehicles (EVs) in South Korea increased 23 percent year-on-year in the first half. In particular, Tesla's sales increased more than 15 times, accounting for 43 percent of all EV subsidies.
EV sales reached 22,267 units in the first half of 2020, up 23.0 percent from the previous year, said a report released by the Korea Automobile Manufacturers Association on July 26.
Sales of electric passenger cars produced in Korea fell to 43.1 percent level of the previous year due to reduced subsidies, the sunset of personal slow charger subsidies and delays in the launch of new models. In contrast, imported electric passenger car sales surged 564.1 percent on new model launch effects. When combined, electric passenger car sales totaled 16,359 units.
Sales of electric cargo trucks grew explosively in the first half thanks to the launch of mass-production models that are competitive in price and performance and the provision of benefits to applicants for a transportation business license who have an electric commercial vehicle. Therefore, 5,031 units were sold in the first half alone, taking up 91.5 percent of annual EV subsidies. The number of electric buses also increased 64.5 percent on year to 181 as subsidies expanded due to local governments’ promotion of eco-friendly bus conversion policies.
In the first half of 2020, domestic carmakers sold 14,563 EV units, down 13.7 percent from a year earlier. As a result, their market share fell from 93.2 percent a year earlier to 65.1 percent. Despite the explosive growth of electric cargo trucks, Hyundai Motor saw its overall sales fall 2.9 percent on year due to a drop in electric passenger car sales, while Kia Motors also saw its electric passenger car sales drop 54.6 percent on year, which contributed to a 23.7 percent reduction in overall EV sales.
By contrast, Tesla saw its share of the electric passenger car market in Korea expand to 43.3 percent in the first half of the year, growing 1,587.8 percent on year thanks to the full-fledged expansion of Model 3 distribution. As a result, the company is estimated to have received 90 billion won, or 43 percent of all subsidies for electric passenger cars.
Meanwhile, most manufacturers of electric vans posted growth, with sales of Chinese buses growing 105.9 percent on year. The share of Chinese-made electric buses in the first half of the year rose to 38.7 percent from 30.9 percent in the previous year. Chinese-made electric buses accounted for 35.1 percent (5.9 billion won) of all electric bus subsidies.
"The distribution of electric cars largely depends not only on vehicle performance but also on subsidy policies,” said Chung Man-ki, chairman of the Korea Automobile Manufacturers Association. “The Korean government needs to improve the subsidy system as subsidies come from taxpayers. France and Germany make their subsidy systems advantageous for French and German automakers, respectively."