In a move signaling its strategic ambitions, Chinese electric vehicle (EV) manufacturer BYD has officially entered the South Korean market. The company, a major player in the global EV arena, announced its arrival in mid-January with the unveiling of the Atto 3 at the SangSang Platform in Incheon.
BYD’s entry into South Korea is marked by the establishment of a dedicated entity, BYD Korea Auto. This new company will focus on the import and distribution of used cars, demonstrating BYD’s plan for a broad approach to the South Korean automotive sector. This entity will manage used car sales and distribution separately from the new car sales handled by BYD Korea. This separation allows BYD to leverage the trends of the used car market, known for its price flexibility and demand for affordable options.
The Atto 3 is positioned as a cost-effective option, priced in the low 30 million won range. This pricing is designed to appeal to budget-conscious consumers. BYD’s representative stated, “It was established considering the market potential of various business fields being developed domestically,” indicating a strategic focus on diverse market segments.
BYD faces some hurdles. The domestic release of the Atto 3 has been delayed due to pending eco-friendly vehicle reporting with the Ministry of Trade, Industry and Energy and supply evaluation certification with the Korea Environment Corp. Despite completing most certification procedures, these bureaucratic processes highlight the regulatory landscape in South Korea. The company is likely taking advantage of the used car market opportunity.
BYD’s low-price sales approach could prove advantageous, particularly given that, as of November last year, the average price of used cars in China was 63,900 yuan (12.69 million won). Furthermore, BYD’s strategy includes aiming the used car business at the corporate sales market. Recent discussions on vehicle supply with a taxi company in the metropolitan area point to the intent for bulk sales in the rental and taxi sectors.
BYD could also utilize the new entity to import its sub-brands such as Fang Cheng Bao, Denza, and Yangwang. These brands target different market segments, ranging from premium vehicles to off-road and customized options. This diversification provides BYD with a comprehensive portfolio to meet the different needs of consumers in South Korea. Denza and Yangwang, part of BYD’s premium lineup, are positioned to attract consumers seeking high-end electric vehicles, while Fang Cheng Bao has designs on niche markets.
