Imported cars have cracked Hyundai and Kia’s home market. Tesla’s electric vehicle Model Y became the best-selling passenger car in South Korea last month, marking the first time the top sales spot, long held by domestic carmakers, changed hands.
According to the Korea Automobile Importers & Distributors Association (KAIDA), the Model Y sold 8,762 units last month. That was more than 900 units ahead of Kia’s Sorento, the best-selling domestic model and No. 2 overall, which sold 7,836 units. It was the first time a single imported model surpassed a domestic model to take the monthly sales lead, and also the first time an electric vehicle claimed the No. 1 spot.
Tesla CEO Elon Musk reacted immediately on the 8th local time. On social media platform X, he posted the Korean flag emoji and wrote, “Korea is the best.” He also shared a post saying a historic moment had occurred in the home turf of Hyundai and Kia. His message reflected Tesla’s self-assessment that one out of every three imported cars sold in Korea this year has been a Tesla.
◆ Price made the No. 1 spot possible
The background behind the record is price. By bringing in units made in China, Tesla lowered the cost of the Model Y. The starting price is 49.99 million won, and subsidies further reduce the burden.
The competitive landscape itself has shifted. Considering that Kia’s flagship Sorento Hybrid starts at 38.96 million won, the price gap between electric vehicles and internal combustion models has narrowed significantly.
If prices are similar, more consumers tend to choose electric vehicles with newer technology. Analysts say Tesla has penetrated the market through an aggressive pricing strategy.
This was not just a single-model achievement. Tesla sold 10,866 vehicles in Korea last month, overtaking BMW and Mercedes-Benz to become the No. 1 imported car brand. That was more than the combined sales of the two German brands. More than one in every three newly registered imported passenger cars was a Tesla.
◆ A weakening home turf, with China as a variable
For Hyundai and Kia, the erosion of their home market is painful. The two companies, which have long enjoyed overwhelming dominance in domestic sales, are now facing a challenge from imported EVs in their own market.
One point worth noting is China. The Model Y’s price competitiveness came from production in China. In addition, Chinese EV maker BYD has also expanded its presence in Korea, selling more than 1,000 units for three straight months. This shows how value-oriented EVs are quickly breaking down Korean consumers’ reluctance.
It is also a signal that price will determine the outcome during the EV transition. In a market where rankings fluctuate depending on subsidies and production location strategies, brand loyalty alone is no longer enough to hold position.
◆ The real test comes after subsidies are phased out
The current lead is not yet secured. The Model Y’s strong performance depends heavily on aggressive pricing and subsidies. If subsidies fall or pricing policies change, the sales curve could shift as well.
Whether this monthly record becomes a trend or remains a temporary surge will be revealed once prices normalize. What is clear is that the no-competition zone domestic cars enjoyed on home soil has disappeared. How Hyundai and Kia respond in terms of pricing and electrification speed will decide the next rankings.