On the roads of first- and second-tier cities such as China, Beijing, Austin, Texas, etc., we can often be surrounded by Tesla or the vehicle management office is chartered by Tesla. In Seoul, South Korea, even in the three wealthy districts of Seoul, the visibility of Tesla on the road is far less than that of Mercedes-Benz trams.
According to South Korea’s YTN TV station, since entering the Korean market in 2017, Tesla’s market share of imported electric vehicles reached a peak of 86% in 2020 and has declined year by year since then, leaving only 21% in 2023.
After “Koreans don’t sleep and don’t have children”, Koreans don’t buy Tesla anymore.
“Domestic cars are more fragrant, who will buy Tesla”
The person who said this was a Korean master driver who drove a “Korea-made” Kia car. He recalled that when Tesla entered the Korean market in 2019, there was a wave of panic buying, and Koreans even lined up at Tesla stores to see cars. However, as South Korean domestic brands make efforts in electric vehicles, fewer people buy Tesla.
You know, South Korea’s land area is about 100,000 square kilometers, which is about the same size as Iran, Finland, and Argentina Moreover, the distance between Seoul and Busan, the two major cities in the north and south, is only 400 kilometers by car, and it takes only two and a half hours by high-speed rail. Even in winter, according to the habit of Tesla’s 50% discount on mileage, it is not as difficult as imagined to run an electric car “Travel to Busan”.
Car companies that do not build charging piles cannot get full subsidies in South Korea
Although it has an inherent advantage, Tesla is already in a “bad” state in South Korea. According to CarIsYou data, Tesla’s new car registrations in South Korea in 2022 will be 14,571, a year-on-year decrease of 18.3%. By 2023, Tesla’s sales in South Korea will drop by half, with only 1,303 new car registrations sold in the first quarter, a year-on-year decrease of half.
Judging from the cumulative sales from January to June this year, Hyundai ( 328,000 ), Kia ( 293,000 ), and Genesis ( 69,000 ) occupy the top three, BMW ( 38,000 ) and Mercedes -Mercedes-Benz ( 35,000 units ) is fifth and sixth respectively, Audi and Volvo are ninth and tenth, and Tesla doesn’t even make it into the top ten.
“Subsidy weaning” is the direct cause of Tesla’s fall
In 2019, Model 3 was priced at 52 million south korean won ( about 40,000 dollars) when it landed in the Korean market, which seemed quite satisfactory. However, including state subsidies and local government subsidies, the landing price of a Tesla in South Korea at that time was only 26,500 dollars.
However, from the beginning of this year, the South Korean government raised the threshold for subsidies.
To obtain subsidies of up to 6.8 million won, automakers also need to meet four criteria, including the maximum battery life on a single charge, whether they have reached the government-specified environmental protection vehicle sales target, the construction of electric vehicle charging infrastructure, and the application of innovative technologies. In addition, the Korean Ministry of Environmental Protection will provide 100% subsidies for electric vehicles priced below 57 million won about 38,400 USD.
If BYD’s unbuilt and unintelligent models enter the Korean market, they will suffer a lot from government subsidies. And Tesla is also suffering from the loss of subsidy adjustments. After the subsidy adjustment earlier this year, the Model Y long-range version was once sold at a high price of 84.99 million won ( about 65,000 USD).
Who will buy a Tesla with a battery life of 350 kilometers?
However, in July of this year, Tesla’s “pricing innovation” of traditional arts began to exert its strength again.
Tesla exported the Model Y made in China to South Korea, and the price was only 48 million won ( about 37,000 USD) lower than the subsidy threshold. If subsidies from local governments are also added, such as the Tesla subsidy in Incheon City, it can be reduced to 47 million won ( about 35,000 USD).
As for whether there will be a situation of “Tesla running all over the street” in South Korea, I can safely tell you that it will not.
“In the past, consumers were willing to choose Tesla because there were few competitors. Now that many brands have launched electric vehicles, Tesla’s sales will inevitably decline.” Lee Hang-gu, president of the Korea Institute of Automotive Fusion Technology, believes that Tesla The initial advantages, namely long-range and autonomous driving systems, have gradually lost their appeal amid fierce competition in recent years. On the contrary, shortcomings such as quality, dissatisfaction with after-sales, and opaque prices gradually emerged.
In the first half of 2023, in South Korea’s KICSI imported car service index, Volvo scored 75.74 points ( out of 100 points ), ranking first; while Tesla scored 64.9 points, ranking 13th, and its after-sales service quality is lower than that of Korean imported cars Average for the brand. The investigation showed that Tesla failed to meet customer requirements in terms of service facilities, accurate positioning of problems, and fulfillment of commitments.
Abandoning Tesla and choosing “domestic brands”, this Korean wave is unstoppable.
How are Korean trams developing?
Different from the Chinese market, South Korea has always been dominated by its “domestic brands”.
In 2022, the top 20 models of domestic car sales in South Korea will all come from local Korean manufacturers. South Korea’s top five automakers, including Hyundai and Kia, hold about 80 percent of the domestic market.
After switching to the electric car track, just like the “Shanghai Tesla phenomenon”, Tesla’s rush to buy in South Korea made Kia and Hyundai feel like they were on pins and needles. So in 2021, the “two Korean brothers” launched counterattacks one after another. Kia released the first model EV6 based on the pure electric platform E-GMP, while Hyundai released the first model IONIQ 5.
However, the Korean trams previously focused on “obscene development”.
On July 27, Kia announced its second-quarter financial report. During the period, Kia achieved revenue of 26.244 trillion won (about 2.06 billion U.S. dollars), a year-on-year increase of 20.0%; gross profit margin was about 23.1%, a year-on-year increase of 2.2 percentage points, catching up with Tesla, which is known for cost control. In addition, Kia Motors’ current operating profit margin reached 13%, which also surpassed Tesla’s 9.6% operating profit margin in the same period.
But technology, Kia’s current strength only stays at the PPT level.
Starting from the Tesla Model 3, pure electric vehicles look more and more like “mouses” — small heads, big bodies, and long tails. This is because the vast majority of trams are trying their best to pursue low wind resistance design, and can only minimize the windward area as much as possible.
However, judging from the latest design language of Kia EV5 and EV9, their tough and upright appearance somewhat ignores wind resistance. Especially on the front face, Kia’s ancestral “tiger-roaring” design elements have been retained.
The problems raised by designers are solved by engineers.
In the Nanyang Research Institute, there is a full-scale wind tunnel that cost 42 million USD to build, which is equivalent to the height of a three-story building. It has a super large transmission shaft with a diameter of 8.4 meters, which can form a strong wind with a maximum speed of 200km per hour. Only through repeated wind tunnel tests can the parameters of wind resistance and wind noise be adjusted. According to the staff, this wind tunnel will “blow away” 35,000 USD every day.
This is the only wind tunnel in South Korea, every Kia product will go through countless wind tunnel tests at the beginning of its design. While ensuring the beautiful appearance of the vehicle and the solid body frame, it strives to achieve a streamlined body with less wind resistance.
Secondly, the three electric technologies all rely on “stack”
Trams have no technical content, and it seems to have become a common perception. Compared with internal combustion engines, the technical threshold of motors and batteries is indeed lower, but this does not mean that the research and development of the three-electric system has reached its peak. For the vast majority of trams, they still wear the hat of “starting as fast as a leopard in the urban area, and as slow as a donkey when getting on the high speed”.
The three big mothers in the era of fuel vehicles are about to be replaced now
To give a simple example, BYD Han EV can easily accelerate from 100 kilometers in 3.9 seconds, but the top speed is only 185km/h. Maybe you will say that the domestic speed limit is 120km/h, and it is useless to have such a high top speed. But you have to know that if you export to a country with unlimited speed limit highways like Germany, I am afraid that even the cargo will run away with you.
This time, at the largest HMG driving experience center in Asia. The car is equipped with a dual-motor system with a comprehensive output power of up to 430kW, a comprehensive output torque of up to 740N m, and a high-performance motor with a maximum resolution of 21,000 times per minute.
Generally speaking, there are two ways to increase the output of the motor, either to increase the voltage or to reduce the inductance of the motor. But the most critical point of the EV6 GT is that it uses a 2-Stage motor system on the rear wheel motor system — that is, through two motor controllers, the motor can reach a higher voltage.
Below the EV6 GT steering wheel, there is a yellow-green “GT Mode” button. After pressing this button, the dual motor controller will start working. In addition, components such as the brake system, steering system, shock absorbers, etc are automatically set to the most aggressive state. No matter in the initial stage or the mid-to-late stage of re-acceleration, the power output is continuous.
Finally, the use of environmentally friendly materials depends entirely on “cheat”.
To create a high-end that is visible to the naked eye and within reach, more and more leather materials are attached to the interior of the car. But the mixed leather package makes the formaldehyde problem more difficult. Not long ago, in the “4-hour exposure test” conducted by Dianchedi, only 2 test vehicles had formaldehyde content exceeding the standard; 97% of the vehicles had formaldehyde content exceeding the recommended value (0.1mg/m³) after exposure to the sun.
“When designing, use as close to nature and sustainable materials as possible.” Karim Habib, senior vice president of Kia and chief executive of Kia Global Design Center, told Huxiu that Kia A “Sustainable Design Strategy” has been formulated, and it is planned to phase out the use of natural leather and increase the use of plant materials such as corn, sugar cane, and natural oil.
The concept of “no leather” is not to let consumers sacrifice the sense of atmosphere, or sit on fabric seats and endure the embarrassment of “stuffy buttocks”. In the Design Center, Kia showcased their application of ten essential sustainable materials such as bio-plastics, bio-polyurethane, and recycled PET fabrics.
For example, EV9’s seats are not made of leather but made of environmentally friendly materials extracted from corn.
In terms of touch and appearance, this bio-PU material has no obvious difference from traditional animal leather. And this kind of feeling is like, many vegetarian restaurants with thousands of per capita make vegetarian food look and taste like meat. Can’t help but remind people of the narration in “A Bite of China” — high-end ingredients often only need the simplest cooking method.
Conclusion
“Korean electric cars” won Tesla in South Korea, not purely by-product power and brand power. Because the South Korean government’s subsidies have also slightly helped domestic car companies. According to this year’s subsidy standard, the subsidy for domestic electric vehicles in South Korea is at least 2.5 million won more than that for imported electric vehicles. Perhaps because of this, users will be more willing to buy pure electric vehicles produced in South Korea.
Considering the current extreme introversion in the Chinese market, Kia did not launch the regular version of the EV6, but first used the EV6 GT, a small-batch high-performance model, to allow consumers to establish their basic awareness of electrified products.
This year’s main focus is the medium-sized pure electric SUV Kia EV5, which will make its global debut at the Chengdu Auto Show at the end of August. It will be produced in China and exported overseas. Next year, Kia will launch the Kia EV9, a mid-to-large pure electric SUV, in China. The model will be equipped with two lidars to support L3-level autonomous driving — to put it more bluntly, one is the standard Weilai ES6, and the other is more like the “ideal L9 of the pure electric version”.
In the long run, if Korean electric vehicles want to get a share of the Chinese market, it is not enough to just put new cars in. The needs of Chinese consumers for products and configurations are changing with each passing day. Only when they are deeply rooted can they understand the truth.
After all, if Koreans don’t have children, how can they understand the most urgent needs of “dads”?
