Only one Tesla was sold in Korea this year as the government pushes to slash EV subsidies for cars with Chinese batteries.
One Tesla car was newly registered in Korea in January compared to 1,022 vehicles in December, according to data from the Korea Automobile Importers & Distributors Association (Kaida).
It comes as the government has yet to announce a new EV subsidy rule for the year and is pushing hard to cut subsidies for EVs powered by cheaper Chinese batteries.
According to multiple local reports, the Environment Ministry is currently collecting feedback on its newest EV credit regulations, which aim to offer low credits to EVs with less energy density.
The policy targets China’s lithium iron phosphate (LFP) batteries, which cost less but have less energy density than high-performance nickel-cobalt-manganese (NCM) batteries, where Korean battery makers stand on firmer ground.
The new law will likely go into effect as early as February.
Tesla’s Chinese-made Model Y was a big hit in the domestic market last year. Thanks to its LFP batteries, it was released with a 20 million won ($15,000) cheaper price tag than the U.S.-made version. Tesla will soon release a similar version of the Model 3 in Korea.
In 2023 alone, 13,885 Shanghai-made Model Ys were sold in Korea, making it the country’s No. 1 imported EV in sales.
Kia’s Ray EV, KG Mobility’s Torres EV and Volvo’s EX30 also use LFP batteries.
BY SARAH CHEA [[email protected]]