Chinese electric vehicle leader BYD officially entered the South Korean electric sedan market last month, causing unprecedented price competition in the South Korean automotive industry. Additionally, concerns about potential leakage of user personal data in South Korea have been raised due to BYD’s low prices.
On January 16, BYD announced its official entry into the South Korean market with its first model, the compact electric SUV ATTO 3 (known as Yuan PLUS in China).
The ATTO 3 comes in two versions: standard and plus. The standard ATTO 3 is priced at 31 million Korean won (approximately $21,000), while the ATTO 3 Plus is priced at 33 million Korean won (around $23,000). The ATTO 3 is priced at 119,800 yuan (about $16,000) in China, with its standard version priced at 38,000 euros (around $40,000) in Europe and 4.5 million yen (about $30,000) in Japan. Taking into account the subsidies offered by the South Korean government, the actual purchase price is expected to be 29.5 million Korean won (about $20,000).
The pricing of the ATTO 3 is significantly lower than industry expectations and lower than competitors such as Hyundai Kona electric and Kia EV3.
As of early February, orders for the ATTO 3 SUV in South Korea have exceeded 1,000 units. In comparison, BYD sold only about 2,000 units in Japan last year. Analysts in South Korea believe that this indicates BYD may have a greater impact on the South Korean market than expected.
As a result of this, coupled with the slowing demand in the electric vehicle market and low domestic demand in South Korea, local car manufacturers such as Hyundai and Kia have been forced to reduce the prices of their electric vehicles in response to the competition, leading to an unprecedented price war in the South Korean automotive industry.
Hyundai and Kia have slashed the prices of their electric vehicles by up to 5 million Korean won since February 5. With the addition of government subsidies, the prices can be reduced by up to 10 million Korean won. Furthermore, imported electric vehicle brands like Stellantis Korea, BMW Korea, and Mercedes-Benz Korea have also implemented varying degrees of price cuts.
In response to the low-price dumping of Chinese electric vehicles such as BYD in the South Korean market, there have been calls within South Korea to provide more subsidies to domestic electric vehicle manufacturers.
At a recent roundtable meeting organized by the ruling party in the South Korean parliament, Kim Gyeon, director of strategy at Hyundai Motor Group’s HMG Institute, suggested exploring various measures, including “direct subsidies” to South Korean electric vehicle companies, in response to the direct subsidies provided by the Chinese government to electric vehicle companies.
Lee Chul-gyu, a member of the ruling party, noted the importance of providing more subsidies to domestic electric vehicle manufacturers from an industrial policy perspective, while Kim Won-i, a member of the largest opposition party, expressed agreement with the positive role of the government in modifying subsidy policies for the industry.
According to official Chinese data, over the past 13 years from 2009 to 2022, China’s cumulative subsidies for new energy vehicles have exceeded 200 billion yuan (approximately $27.36 billion). However, with China discontinuing national subsidies in 2023, the sales volume of electric vehicles in the domestic market has decreased, leading to overproduction. Chinese electric vehicle manufacturers have begun exporting excess products to overseas markets at competitive prices.
Countries around the world have implemented various measures to protect their industries from the threat of low-priced Chinese electric vehicle exports.
In response to the challenges posed by Chinese electric vehicles and electric vehicle batteries in the South Korean market, the South Korean government significantly reduced subsidies for electric vehicles equipped with Chinese-made phosphate lithium batteries in its electric vehicle purchase subsidy program last year. This included Chinese-made Tesla Model Y (RWD), electric buses, and trucks. BYD, which had not officially entered South Korea at the time, saw a reduction of approximately 8 million Korean won (around $6,000) in subsidies compared to 2023. On the other hand, electric vehicles equipped with ternary lithium batteries made in South Korea received more subsidies.
France began implementing differential subsidies for imported electric vehicles starting in 2023, by calculating environmental scores based on carbon emissions to determine subsidy reductions. This move effectively excluded Chinese electric vehicles from incentive programs, as energy consumption in Chinese automobile manufacturing processes heavily relies on coal-generated electricity, resulting in significantly higher carbon emissions compared to European standards.
The Biden administration quadrupled tariffs on Chinese electric vehicles to 100% in September last year, with the Trump administration adding an additional 10% tariff recently.
Starting from October last year, the European Union imposed anti-subsidy tariffs on Chinese electric vehicles, with the highest actual tariff rate reaching 45%.
With the official entry of BYD into South Korea, concerns about security risks associated with connected cars have once again drawn attention in South Korean society. Connected cars can connect to the internet and access wireless networks, allowing vehicles to share network resources with other devices both inside and outside the vehicle.
South Korea is worried that due to the inadequacies in South Korea’s relevant legal systems, Chinese-made connected cars may become channels for the leakage of personal data. The BYD ATTO 3 features connected car functions like wireless phone projection, wireless (OTA) navigation, and software updates that collect personal data from car owners, raising concerns about potential data leaks to China.
Although BYD Korea has pledged that personal data collected in the South Korean market will not be shared with the Chinese headquarters, it has been pointed out that the collected user data is stored on Tencent cloud servers. The fact that the server owner is a Chinese company has sparked concerns among South Korean users about the leakage of personal data.
In addition, BYD recently announced plans to apply AI software “DeepSeek” to its vehicles. However, the use of DeepSeek has been restricted in several countries due to security issues.
A recent consumer survey conducted by South Korea’s largest direct-operated used car platform company, K Car, revealed that only 11.6% of respondents have a positive attitude towards Chinese car brands like BYD entering the South Korean market in 2025. 51.8% hold negative attitudes, with worries about quality, durability (62.2%), and safety (54.4%).
Regarding the risks associated with BYD vehicles, a researcher and director at Taiwan’s National Chung Cheng University Institute for National Security Studies, Shen Ming-shi, spoke to Epoch Times on February 14, emphasizing the various risks associated with BYD vehicles. Last October, several Australian car owners disclosed on social media platforms that their BYD electric vehicles’ onboard systems may have hidden “backdoors,” allowing the manufacturer to eavesdrop on conversations inside the vehicle. This has raised significant concerns among owners.
Shen pointed out that identifying the key chip or device to deactivate the backdoor is crucial but challenging as the manufacturer may not be aware of its location or origin. He stressed that all Chinese electronic products may potentially come equipped with various backdoors to collect data surreptitiously and transfer it to Chinese databases or systems, highlighting that choosing not to buy or use such products may be the only way to avoid being affected.
Furthermore, he highlighted that last September, BYD had to recall around 100,000 vehicles due to the risk of overheating in its storage capacitors, demonstrating continued instability in certain technical aspects.
It is not only Chinese brand vehicles but also models equipped with Chinese connected car technology that pose the risk of personal data leakage.
The U.S. Department of Commerce issued a ban in January that prohibits the sale and import of Chinese and Russian connected car hardware and software systems, as well as whole connected cars. The ban aims to ensure the security of the critical supply chain and national security of the United States, and help prevent cyber espionage and intrusion activities by the Chinese government that pose significant threats to U.S. critical infrastructure and public safety. When announcing plans for the ban last year, former White House National Security Advisor Jack Sullivan stated that there was substantial evidence indicating that China had deployed malicious software in U.S. critical infrastructure in advance, leading to concerns about attacks and deliberate disruptions. Additionally, with potentially millions of vehicles on the roads with an average lifespan of 10 to 15 years, the risks of sabotage and deliberate attacks have increased significantly.