[Editorial] Warning: South Korea Could Lose 2 Trillion Won in EV Exports to China by 2030

The structural crisis facing South Korean automakers, once speeding ahead in global markets, is serious. One clear sign is that while the global EV market is growing explosively, South Korean-made EVs are losing ground. According to the Federation of Korean Industries’ report, “The Current Status and Implications of South Korean EV Exports and Competitiveness,” EVs’ share of global new-car sales surged from 2.6% in 2019 to 25.0% last year. Yet South Korean EVs’ share of the domestic market plunged from 73.7% to 57.0% over the same period. South Korea’s share of global EV exports also fell by more than 40%, from 8.1% in 2023 to 4.6% last year. EVs are the backbone of the future auto market, yet South Korea is losing ground both at home and abroad.
We can fix the things we have done poorly, but it is difficult to counter China’s aggressive market encroachment, driven by low prices. China once imported more EVs than it exported, but it has now become an export powerhouse leading the global EV market. South Korea’s EV competitiveness is declining by comparison.
If this trend continues, the global EV landscape—not just South Korea’s—will tilt so decisively toward China that it will be impossible to do anything about it. The FKI estimates that if China’s export share continues to expand at its current pace, Chinese-made vehicles could displace about 2.2 trillion won worth of South Korean EV exports by 2030. In other words, unless we strengthen our industrial competitiveness, we could face a major crisis by then.
This is not just a problem for automakers, which is all the more reason for us to be concerned. If fewer EVs are made in South Korea for export, utilization rates at production facilities will fall. Parts and materials suppliers that serve automakers, jobs, and local economies could all be shaken in turn. A downturn at a single automaker could bring down the parts-industry ecosystem surrounding it. Once that ecosystem collapses, it is difficult to revive. In the worst-case scenario, South Korea’s auto industry could become dependent on China’s automakers and industrial ecosystem.
We have already been through a similar process. Hyundai Motor, which once made rapid gains in China, saw its sales plunge amid the rise of Chinese automakers and controversy over China’s retaliation related to the Terminal High Altitude Area Defense (THAAD). Eventually, it closed its local factories and was left barely maintaining a presence with an extremely small market share. As in Japan, its presence in China had effectively collapsed. Small and midsize suppliers that entered China alongside Hyundai Motor also shut down one after another, suffering enormous losses. This showed that a crisis at an automaker can put the entire industrial ecosystem at risk.
Global competition in EVs is neither a battle between companies nor competition governed by market principles. It is more like a contest between nations. However innovative a company’s technology may be, it cannot compete effectively against other countries’ industrial policies, such as government subsidies. Chinese EV makers are dominating the market with strong backing from the Chinese government; our government must not simply stand by.
The government should actively consider ways to support businesses, such as domestic-production tax credits that offer greater benefits the more companies produce in South Korea. Beyond policies focused on automakers, it should carefully examine the supply chain so it can also strengthen the competitiveness of small and midsize suppliers in related fields, including batteries, materials, and parts. We cannot repeat the painful experience we had in China. To avoid the mistake of shutting the stable door after the horse has bolted, we must act boldly and proactively, starting now.