As Japanese carmakers exit Korea, Chinese EV brands rush in to fill gap

Visitors check a BYD Seagull electric vehicle (EV) displayed at the Beijing International Automotive Exhibition, or Auto China, in Beijing, Apri. 26. Reuters-Yonhap

Chinese electric vehicle (EV) manufacturers are rapidly expanding their presence in Korea, filling a void left by the gradual retreat of once-dominant Japanese automakers.

The shift has unfolded after a series of exits by Japanese brands, beginning with Nissan in 2020 and followed most recently by Honda.

Last week, Honda Korea confirmed it will end vehicle sales in the country by the end of this year. The decision will further shrink the footprint of Japanese carmakers in Korea, leaving only Toyota and its luxury division Lexus actively maintaining sales operations.

In contrast, Chinese automakers — driven by their aggressive EV expansion strategy — are accelerating their push into the Korean market.

Foremost among them is BYD, which has quickly established a strong foothold through its local unit, BYD Korea.

The company surpassed 10,000 cumulative vehicle sales in Korea roughly one year after beginning passenger EV deliveries in April last year. It also climbed to fourth place among imported car brands in monthly sales in March, overtaking both Toyota and Lexus.

Industry officials said BYD’s early success reflects a gradual shift in consumer perception. Chinese vehicles — once viewed cautiously over concerns about quality and after-sales service — are increasingly gaining acceptance, supported by competitive pricing and improving product standards.

That momentum is expected to continue, as more Chinese brands prepare to enter the market.

Visitors look at a Zeekr 009 Grand at the Beijing Auto Show in Beijing, Sunday. AFP-Yonhap

Zeekr, the premium EV brand under China’s Geely Auto Group, has already begun recruiting staff in Korea across multiple functions, including sales, customer service and legal affairs, ahead of its official launch.

Zeekr plans to introduce its mid-size electric SUV, the 7X, in the Korean market in the second half of the year. The model is expected to compete directly with established EVs, such as the Tesla Model Y, Hyundai Motor's IONIQ 5 and Kia EV5.

The company is also preparing to expand its retail footprint, with showroom sites reportedly under consideration in key urban centers, including Seoul, Busan and Daejeon.

Other Chinese automakers are following a similar trajectory. Xpeng established a Korean subsidiary last year and is accelerating its market entry plans, while Chery Automobile is also widely expected to follow, even if specific timelines remain unconfirmed.

“Japanese brands have remained more focused on internal combustion engines and hybrid models, which is seen as a key factor behind Honda Korea’s decision to withdraw from the market,” an industry official said.

“Chinese EV makers are likely to capture more opportunities here, as they are more aggressive in pushing the transition toward electric mobility than their Japanese counterparts.”