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EV luxury market boom as rivals catch up with Tesla

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G80e, the electric version of the Genesis premium sedan G80. HYUNDAI MOTOR/THE KOREA HERALD

EV luxury market boom as rivals catch up with Tesla

For many drivers who aspire to move to eco-friendly battery electric vehicles (BEV) this year, one of the key variables is the availability of government subsidies. Amounts vary depending on the market price of the car.

When it comes to high-end demand, however, subsidies apparently made no difference as luxury BEVs aggressively expanded their presence, especially against global market champion Tesla, industry data showed this week.

According to data compiled by the Carisyou Data Lab on vehicle registration statistics from South Korea’s Ministry of Land, Infrastructure and Transport, the number of imported electric vehicles (EV) sold from January to April this year came to 4,351, up two per cent from the same period last year.

Of the total, Tesla still accounted for 3,308 vehicles. But its market share shrunk 18.8 per cent year-on-year, while that of other global competitors soared 450 per cent during the same period.

Next to Tesla were Porsche, which sold 493 electric Taycan 4Ss, and Mercedes-Benz, which sold 242 EQC electric SUVs. French carmaker Peugeot sold 94 e-2008 SUVs, while German rivals Audi and BMW respectively sold 70 e-tron 55 SUVs and 60 i3s.

Market competition is anticipated to intensify further in the latter half of the year, as premium German carmakers are set to roll out luxury EV models apparently targeting young, rich drivers seeking advanced performance and a long driving range.

Mercedes-Benz’s large electric EQS sedan, BMW’s iX electric SUV and Audi’s e-tron GT electric sports car are slated to be released within the year.

All of those models are excluded from South Korean government subsidies as they retail for more than 90 million won ($80,500).

Under revised rules starting this year, vehicles priced below 60 million won are eligible for the maximum amount, while those priced between 60 million won and 90 million won qualify for half the ceiling.

The maximum subsidy from the Korean central government is eight million won for each buyer, while provincial governments may offer up to 11 million won. The final amount paid to the buyer reflects provincial and central government subsidies combined.

In the case of Audi’s RS e-tron GT, the line’s premium racing edition, the retail price in the European market came to €138,200 ($170,000). The domestic retail price of Tesla’s premium electric sedan Model S is currently set at 199.9 million won.

While German carmakers vied for market share initiative, South Korea’s top domestic automaker, Hyundai Motor, geared up to sell the G80e, the electric version of the G80 sedan, under premium independent brand Genesis, starting in July.

The new model, which runs a maximum of 427km on a single charge and takes 4.9 seconds to reach 100km/h from zero, is expected to carry a retail price of around 900 million won.

“Hyundai Motor will face increased market competition in the high-end BEV sector, but will still keep an upper hand, thanks to steady demands for official vehicles and company cars,” said an official with one of the leading imported car brands in South Korea.

Meanwhile, in the budget price group, anxiety has been escalating as the South Korean government’s subsidy balance shows signs of earlier-than-expected exhaustion.

According to data compiled by the Korea Automobile Manufacturers Association, applications for all-electric car subsidies received as of end-April came to 81.5 per cent of the yearly budget.

The lack of funds in the budget especially weighed down on Hyundai Motor, which has had to suspend manufacturing several times this year due to a prolonged shortage of semiconductors.

The Korean automaker recently suggested that purchasers of the Ioniq 5, the company’s new all-electric vehicle, compromise on some of the options to speed up delivery.

The move was seen as an effort by the carmaker to prevent impatient buyers from dropping their orders and switching to already-available EV models to secure subsidies in time.

Since launching the Ioniq 5 on February 25, Hyundai Motor has received about 43,000 pre-orders, but only about 200 of the vehicles had been delivered as of the second week of this month, industry data showed.

THE KOREA HERALD/ASIA NEWS NETWORK

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