The global advance of Chinese electric vehicles has become unstoppable. Six of the world's 10 best-selling EV makers in the first half of this year were Chinese, led by BYD at No. 1. Together they commanded more than 60% of the market.
Chinese automakers built their scale on a vast domestic market and government subsidies running into the hundreds of trillions of won. Now that the home market has reached saturation, they are pushing that volume overseas. As in steel and solar panels before it, China's most powerful weapon is price. More recently, analysts say Chinese makers have closed the gap in design and self-driving technology as well. At a recent meeting with an auto industry official who remarked that major imported brands no longer design as well as they once did, one comment stuck with me: "All the people who used to turn out great designs at the established makers are now in China."
Europe, long considered a leader in automaking, has been a playground for Chinese cars for some time. Chinese-made models now account for about 15% of Europe's EV market. The European Union imposed tariffs of up to 45.3% on Chinese-built EVs in late 2024, but the move came too late. Chinese makers are now expanding production in Europe aggressively, as if to mock the duties. BYD has begun bringing its Hungarian plant online, while Geely and Chery are preparing to stamp "Made in Europe" labels on EVs built at idle Ford and Nissan plants in Spain.
Korea, meanwhile, has barely any barrier at its border. The tariff on cars imported from China is just 8%. The pace of market capture is rapid: roughly four of every 10 imported vehicles sold in the first half of this year were Chinese-made. Because China has already learned how to get around tariffs, raising them will not be enough.
What is needed now is a dense set of support measures to protect domestic industry and jobs. Standing idle, as Korea is doing, will lead to the European outcome — surrendering the market, the technology and the factories alike. Introducing a domestic production incentive tax credit, giving automakers a tax break for building EVs at Korean plants, would be a starting point for defending the industry.
