The Kia EV4 (Image courtesy of Hyundai Motor/Kia)
SEOUL, Feb. 26 (Korea Bizwire) — Global automakers are rolling out lower-priced electric vehicles this year despite facing a temporary plateau in demand, known in the industry as a “chasm.” The strategy aims to attract cost-conscious consumers while securing market share ahead of widespread EV adoption.
According to industry sources on February 24, Kia plans to unveil the concept car for its compact electric SUV, the EV2, at Kia EV Day in Tarragona, Spain, later this month. The vehicle, similar in size to Hyundai’s Casper Electric, will target the European market.
At the same event, Kia will showcase the EV4, its first compact electric sedan, which will launch in South Korea next month. The EV4 will effectively replace the K4, marking Kia’s complete transition to electric vehicles in the compact sedan segment. The company also plans to expand global sales of its compact electric SUV, the EV5, which was previously launched in China and the Middle East.
Tesla is set to release its compact hatchback Model Q in the first half of this year. The vehicle is expected to be priced around $30,000, making it more affordable than the Model 3 sedan, of which over 10,000 units were sold in South Korea last year. Volkswagen will introduce the ID.2all next year, priced at approximately 25,000 euros, ahead of its entry-level electric vehicle planned for 2027.
Competition in the South Korean market has already intensified. Since its launch last July, Kia’s compact SUV EV3, priced starting in the mid-30 million won range, has seen sales exceed 122,000 units in just six months. Meanwhile, sales of Hyundai’s Casper Electric have reached 8,657 units since deliveries began in the fourth quarter of last year.
Consumer preferences are increasingly shifting toward price-competitive models. According to the Korea Automobile Manufacturers Association (KAMA), the market share of electric vehicles priced between 30 and 40 million won jumped from 12.5% in 2023 to 32.8% in 2024. Deloitte’s “2025 Global Automotive Consumer Survey” revealed that Korean consumers prioritize fuel cost savings (57%), environmental protection (43%), and maintenance cost reduction (38%) when purchasing electric vehicles.
The strategy also aims to counter Chinese competitors like BYD, which recently launched its Atto 3 SUV in South Korea at just over 30 million won, or about 29 million won after government subsidies – approximately 10 million won cheaper than in Japan. Volvo has priced its new compact electric SUV, the EX30, at its lowest global price point in South Korea, expected to start in the low 40 million won range after subsidies.
Industry experts remain optimistic about EV demand despite the current plateau. “Despite the market ‘chasm,’ EV sales didn’t significantly decline last year, excluding commercial vehicles, thanks to increased sales of compact models,” an industry official said. “With automakers launching more entry-level models, we expect overall EV sales to grow compared to last year.”
Kevin Lee (kevinlee@koreabizwire.com)
