Tesla’s January Sales Plummet in South Korea
Tesla has drawn attention after it was revealed that it sold only five electric vehicles in South Korea last month.
According to recent data from the Korea Automobile Importers and Distributors Association (KAIDA), Tesla sold only five units in January 2025 in South Korea. This was primarily due to the temporary absence of EV purchase subsidies.
The Gap in EV Purchase Subsidy Announcement
The EV purchase subsidy policy is announced every year in January or February. This year, the subsidy reform was administratively announced in early January, but the application period varied by local government, leading consumers to postpone their purchases.
The gap between the announcement of EV purchase subsidies and the start of applications significantly impacts sales volume. Only some local governments allowed subsidy applications in January, so most consumers waited for the subsidies starting in February.
Also, last year, the sales of imported electric vehicles in January and February were 821 units and 1,174 units, respectively, since most local governments began accepting subsidy applications in late February.
Once subsidies became available in March, sales surged to 8,242 units – a tenfold increase from January.
Poor Performance in the European Market
Tesla’s sales are declining not only in South Korea but also in Europe. Sweden’s market share dropped from 4.2% to 2.1% in 2024. Norway saw an even steeper decline, falling from 21.7% to 7.4% in the same period.
Market analysts point to increased competition in the EV sector and controversial statements by CEO Elon Musk as factors contributing to Tesla’s market share erosion.
Adding to Tesla’s troubles, the company’s failure to secure product liability insurance could make it ineligible for subsidies starting in July, potentially worsening its sales outlook.
Analysis and Forecasts from Domestic Experts
Despite the gloomy January figures, some industry experts remain cautiously optimistic about Tesla’s prospects in South Korea.
Professor Lee Ho Geun from Daedeok University’s Future Automotive School explains, “While EV subsidies were announced early, consumers could not immediately take advantage of it. We expect sales to rebound from February as buyers can now take advantage of these incentives.”
For 2025, confirmed EV purchase subsidies for Tesla vehicles range from 1.83 million to 2.02 million won ($1,408 to $ 1,550) for the Model 3 and 1.84 million to 2.02 million won ($1,415 to $1,550) for the Model Y.
These subsidies are expected to make Tesla vehicles more attractive to cost-conscious consumers, potentially driving a sales recovery in the coming months.
