The Audi RS e-tron GT
Imported vehicle dealers in South Korea are offering deep price cuts amid a growing electric vehicle phobia following a Mercedes-Benz EV blaze that caused extensive damage.
According to industry sources on Monday, foreign brand auto dealers are set to offer retail price cuts by nearly 30% next month to woo new car buyers.
Data from Getcha, a Korean vehicle purchase information provider, out of 30 imported vehicles that offer at least 20% discounts, 22 models, or 73%, are electric cars.
German automaker Audi AG’s e-tron 55 quattro sells at 82.56 million won ($60,188), a 29.5% discount from its regular price.
The Audi Q8 e-tron Sportback and the e-tron S quattro also sell at a 29.5% discount, respectively.
The high-performance RS e-tron GT sells at 153.7 million won, a 24.5% discount.
(Graphics by Dongbeom Yun)
Discount rates for those Audi vehicles were up to 20% last month.
BMW Korea offered no discounts for the i7 xDrive60 in July, but this month it is selling the EV at a 12.7% discount.
The iX xDrive50 Sports Plus sells at a 12.9% discount price of 135 million won.
Mercedes-Benz offers a 10% discount to sell the EQE EV at 103.5 million won. Volkswagen offers a 23% discount for the ID.4 to sell it at 54.9 million won.
INFLUENCED BY A MERCEDES FIRE
“Imported vehicles usually get higher discounts near the end of the year. But this time, foreign brand dealers are unusually offering sharper discounts even in the summer. Probably, they were influenced by the weakening consumer sentiment toward EVs following the Mercedes blaze,” said an imported vehicle dealer.
The BMW iX
The actual purchase price of an imported vehicle is usually determined by the official prices set by the foreign brands’ Korean offices and the discount rates set by their dealers.
If inventories rise amid weak sales, dealers slash the margins they get by offering higher discounts.
Volkswagen Korea saw some of its contracted flagship ID.4 model were recently canceled.
“Some customers who came to us to buy an electric model ended up switching to internal combustion engine cars,” said a foreign brand dealer in a posh Seoul district.
HYUNDAI, KIA UNDETERMINED YET
Korea’s two largest automakers – Hyundai Motor Co. and Kia Corp. – haven’t decided yet over their sales price discounts for next month.
However, Hyundai has launched a promotional event offering a free two-night stay at the Hilton Grand Vacations (HGV) hotel in Hawaii for buyers of the IONIQ 5, IONIQ 6 and Kona Electric until August 2025.
The Mercedes-Benz EQE
On Sunday, Hyundai revealed on its website a list of manufacturers of the batteries used in 13 of its EV models.
Excluding the Kona Electric, which uses China’s Contemporary Amperex Technology Co. Ltd. (CATL) batteries, all Hyundai EVs use battery packs made by LG Energy Solution Ltd. or SK On Co.
Kia followed suit on Monday, making public the list of its battery partners.
Kia’s seven EV models, including the EV3, EV6 and EV9, run on LG Energy or SK On batteries. Some latest models of the Ray EV and the compact crossover Niro EV are equipped with CATL batteries.
EV PHOBIA
Foreign brands’ deep price discounts come amid a growing EV phobia in Korea following a series of fires involving electric cars.
Earlier this month, a Mercedes-Benz EQE electric sedan, with batteries made by Chinese company Farasis Energy, caught fire in the underground garage of an apartment building in the Korean city of Incheon.
Police investigate the cause of a fire involving a Mercedes-Benz EV in Incheon, Korea
The blaze took over eight hours to extinguish and damaged about 140 cars. Some 23 people were hospitalized due to smoke inhalation, police said.
According to a recent survey by The Korea Economic Daily and global research firm EV Volumes, a division of J.D. Power, out of 58 electric vehicle models running on the streets of Korea, 22 models are equipped with Chinese batteries.
The survey also showed that of 40 imported EV models, nearly half or 18 of the models sit on Chinese batteries.
Mercedes-Benz, a top foreign brand in Korea, uses Chinese batteries for six of its seven EV models sold in the country, accounting for 85.7% of its Korean sales.
Industry officials said Korean authorities are expected to unveil new measures early next month to allay public concerns about safety in a sector already suffering a sales slowdown.
By Jae-Fu Kim and Jin-Won Kim
hu@hankyung.com
In-Soo Nam edited this article.
