BYD beats Volvo and Lexus — How it cracked Korean consumers' anti-China sentiment

NEWS ANALYSIS

BYD is upending the established order of Korea's import car market, vaulting to fourth place by first-half sales, overtaking long-established brands Lexus, Audi and Volvo, supercharged by an aggressive price strategy.

The ascent is striking given that Korean consumers have long been skeptical of Chinese-made products — partly due to lingering anti-China sentiment, but perhaps more fundamentally because "Chinese-made" had long been synonymous with low prices and questionable quality among Koreans.

Yet BYD has managed to win praise not only for its cost but for its engineering, challenging that long-held assumption.

This shift suggests that Koreans are not buying Chinese cars simply because of their more affordable price tags. Zeekr's premium electric sedan, the 7X, priced as high as 70 million won ($48,000) and positioned against the Genesis GV70, surpassed 1,000 preorders within a month of its debut.

The implications extend beyond Zeekr itself — if Chinese brands can now compete on quality and brand image rather than price alone, incumbents like Hyundai Motor Group and established import brands may face pressure not just at the entry-level segment, but increasingly in the premium tier as well.

Aggressive pricing playbook

The Shenzhen-based EV giant registered 11,675 new vehicles in the first half of the year, enough to leapfrog Lexus and Audi and claim fourth place right after Tesla, Mercedes and BMW — a shift in the market's pecking order unseen in decades.

Sales climbed 808 percent on year, dwarfing Tesla's 192 percent growth over the same period.

That surge owes much to an unusually aggressive pricing approach — one that has seen BYD step in to subsidize its own vehicles. The Korean government recently tightened its criteria for EV subsidies, where BYD was notably absent, with officials citing the company's limited contribution to the domestic EV ecosystem.

BYD immediately announced a program that offers subsidies to its customers to the extent of the government subsidy: 1.26 million won on the Atto 3, 1.69 million won on the Seal, 1.09 million won on the Dolphin, and 1.52 million won on the Sealion 7.

The government provides a subsidy of up to 5.8 million won per passenger vehicle, where vehicles priced under 53 million won receive the full subsidy, while those priced between 53 million and 85 million won receive half. 

Tesla's Model Y can still secure roughly 2 million won in subsidies, while Hyundai and Kia's EVs — as long as they fall within the price cap — can receive close to the maximum. 

"Selling a lot of cars in Korea doesn't move the needle much for BYD's bottom line, but Korean consumers are notoriously demanding and tech-savvy — that makes this market a gateway to the rest of the world," said Kim Pil-soo, an automotive engineering professor at Daelim University.

"BYD wants that badge of credibility that 'it worked in Korea too' and that's why they're leading with aggressive pricing to gain a foothold here first," Kim said. 

BYD has consistently priced its Korean lineup roughly 10 million won below what the same models command in global markets. 

The Seal Dynamic, the high-performance version of the Seal sedan, was launched last year at 46.9 million won in Korea — about 7.9 million won less than in Australia, where it sold for 61,990 Australian dollars ($43,338). It’s 9.9 million won cheaper than in Japan, where it retailed for 6.05 million yen ($36,952).

BYD recently introduced the Sealion 6 DM-i plug-in hybrid at 37.5 million won, compared to 39,990 euros in Europe ($45,508). That undercuts even the Sorento hybrid, Korea's best-selling midsize SUV, which starts at 39.5 million won.

Engineering to match

Industry experts say Chinese automakers can no longer be dismissed as budget players alone.

"BYD hasn't been suffered a single quality issue in more than a year of sales here — no fires, nothing," said Lee Ho-geun, a professor of automotive engineering at Daedeok University. "Anti-Chinese sentiment persists among Korean consumers, but this shows that when a product is affordable and well-made, it can override even personal bias."

Anti-Chinese sentiment among Korean consumers has deep roots — much of it dating back to China's economic retaliation over Thaad missile deployment, when Beijing shut down Lotte Mart stores in China, discouraged Chinese tourism to Korea, and banned the export of Korean entertainment content in 2016 and 2017.

That sentiment intensified after a Mercedes-Benz EQE electric sedan caught fire in an underground parking garage in Incheon's Cheongna district in August 2024, which burned more than 800 nearby cars. The revelation that the vehicle was fitted with a Chinese-made battery reignited consumer suspicion that Chinese components were cheap but unreliable.

"Korean consumers' perception of Chinese-made products was quite negative and that's why BYD Korea actively appealed our headquarters to lower prices, hoping to make the cars as accessible as possible," BYD Korea's spokesperson said.

BYD has also moved deliberately to address aftersales service, long cited as one of the principal reasons Korean buyers hesitate to purchase imported vehicles. 

The Chinese EV giant operates 34 showrooms and 20 service centers across the country as of end of July, with plans to expand to 36 showrooms and 25 service centers by year's end. That rivals long-established European and Japanese brands that have been in the Korean market for decades such as Volvo's 39 showrooms, Audi’s 34, Toyota’s 33, Volkswagen’s 26 and MINI at 22.  

The 'real buyers' are switching

Perhaps the bigger threat to rivals like Hyundai isn't BYD's price tag — it's who's buying. The bulk of BYD's Korean customers are men in their 40s and 50s, precisely the demographic considered the core of Korea's car-buying market: experienced owners who know what they're comparing against.

According to sales data on the 3,968 BYD vehicles sold in Korea in 2025 to March 2026, buyers in their 40s made up 34.6 percent of purchases and those in their 50s accounted for 30.8 percent, together comprising 65 percent of all sales. By gender, men made up 72 percent of buyers and women 28 percent, with men in their 40s representing the single largest segment in both groups.

That breaks sharply with industry expectations that BYD would first draw younger, trend-driven consumers chasing novelty or a low price tag. Instead, it was buyers with prior ownership experience — people equipped to judge build quality rather than just a spec sheet. 

Zeekr's 7X  points to the same pattern, suggesting Korean consumers are not simply hunting for the cheapest EV on the lot but responding to genuine improvements in engineering and quality.

"Zeekr has spent three years studying and testing the Korean market. Now that BYD has proven quality can resonate here, that's a real threat to Hyundai and Kia's actual sales," Prof. Kim said. 

"Hyundai will need to rethink its strategy to respond, given that Korean consumers are no longer buying Chinese cars simply because they're affordable, but quality has now caught up to their expectations."

Nio, Xpeng and Xiaomi are also reportedly weighing entry into the Korean market.

BY SARAH CHEA   [[email protected]]