China has overtaken Germany as South Korea’s largest source of imported vehicles by manufacturing origin for the first time, as Shanghai-built Tesla models and expanding sales by BYD reshape one of Asia’s most competitive car markets.
South Korea registered 79,444 China-built imported vehicles in the first half of 2026, up 127.8% from a year earlier, according to a report released on August 5 by the Korea Automobile & Mobility Association (KAMA). Their share of imported-vehicle registrations rose from 23.5% to 41.2%, putting China ahead of Germany.
Electric vehicles were the main driver of the shift. Registrations of China-made battery electric vehicles reached 69,513, an increase of 178.7% year on year. They accounted for about 35% of all newly registered BEVs in South Korea during the period, up from 26.8% a year earlier.
The figures measure where vehicles were produced rather than the nationality of their brands. Much of the increase came from Tesla（特斯拉）Model Y and Model 3 vehicles manufactured at the company’s Shanghai plant. Tesla registered 56,139 imported passenger cars in South Korea in the first half, making it the country’s best-selling import brand with a 30.5% share of the segment.
BYD（比亚迪）also strengthened its position after entering South Korea’s passenger-car market in 2025. The Chinese automaker registered 11,675 vehicles in the first six months of 2026, ranking fourth among imported passenger-car brands behind Tesla, BMW and Mercedes-Benz. It had sold 6,107 vehicles in the country during all of 2025.
The increase formed part of a broader acceleration in South Korea’s EV market. Total new-vehicle registrations reached 850,636 in the first half, up 1.3% year on year, while BEV registrations jumped 113.6%. Battery electric models consequently accounted for 23.3% of all new registrations.
KAMA attributed the EV expansion partly to the early disbursement of national and local subsidies, the introduction of an additional incentive for drivers replacing internal-combustion vehicles, and growing demand from corporate and vehicle-rental buyers. More affordable electric models also benefited from South Korea’s subsidy system, under which vehicles priced below KRW 53 million are eligible for the full vehicle-price component of government support.
The result does not mean that Chinese brands have displaced South Korea’s domestic manufacturers. Hyundai Motor and Kia continue to dominate the overall market, while Tesla—an American company—accounts for most of the China-made vehicles entering the country. The more significant change is in the geography of production: China has become a major manufacturing and export base for both Chinese and international automakers.
That distinction also explains the wider importance of the Korean data. China’s automotive competitiveness is increasingly expressed not only through the overseas expansion of BYD and other domestic groups, but also through its role in global production networks. For South Korean consumers, the inflow is broadening the range of available EVs and increasing price competition. For domestic manufacturers and suppliers, it raises pressure to reduce costs and protect local production as the market shifts toward electrification.
KAMA warned that the rapid increase in China-made EVs could weaken South Korea’s manufacturing base and intensify supply-chain competition. The association called for electric vehicles to be included in proposed tax incentives for products manufactured and sold domestically, while also urging local governments to secure additional subsidy funding for the second half of the year.