SEOUL — South Korea’s domestic electric vehicle (EV) market experienced an unprecedented boom last month, driven by soaring oil prices linked to the prolonged conflict in the Middle East. However, the nation’s automotive export sector faced severe headwinds, hit hard by shifting tariff policies in the United States and compounding global geopolitical uncertainties.

According to the "April Automobile Industry Trends" report released by the Ministry of Trade, Industry and Energy (MOTIE) on May 20, total domestic vehicle sales reached 151,693 units in April, representing a modest 0.7% increase compared to the same period last year.

Beneath the steady surface, however, a massive structural shift occurred within the eco-friendly vehicle segment. Domestic EV sales skyrocketed to 38,927 units, a staggering 139.7% jump year-on-year. Conversely, hybrid vehicles, which had long driven the growth of the eco-friendly market, experienced a slight contraction, falling 1.9% to 50,872 units.

High Oil Prices and Foreign Brands Accelerate EV Adoption
The Ministry attributed this dramatic surge in EV demand to a combination of factors: sustained high oil prices caused by the lingering Middle East crisis, and the reinforcement of local municipal policies such as the weekly no-driving day program, which incentivizes drivers to switch to zero-emission vehicles.

Foreign EV manufacturers reaped significant benefits from this demand spike. American EV giant Tesla climbed to third place in overall domestic sales rankings, trailing only behind South Korea's leading domestic automakers, Kia and Hyundai Motor. Meanwhile, Chinese EV powerhouse BYD made remarkable inroads into the Korean market, securing the 8th position. BYD's sales surged dramatically from just 543 units in April last year to 2,023 units this April.

In terms of individual model popularity, Kia’s Sorento retained the top spot in domestic sales with 12,078 units. Tesla’s Model Y followed closely in second place with 9,328 units, outpacing traditional domestic favorites such as the Hyundai Grandeur (6,622 units), Sonata (5,754 units), and Avante (5,475 units).

Global Trade Barriers and Geopolitical Friction Dent Exports
In sharp contrast to the thriving domestic market, South Korea's automotive export machine showed signs of cooling down. Escalating external uncertainties, particularly aggressive tariff postures from major trading partners and the ongoing Middle East conflict, weighed heavily on outbound shipments.

In April, total automobile export value dropped by 5.5% year-on-year to $6.17 billion. The overall volume of exported vehicles also dipped slightly by 0.8%, totaling 244,990 units.

Regionally, exports to the United States fell by 5.3% to $2.74 billion, a decline heavily influenced by Washington's current 15% tariff policy on imported vehicles. Shipments to the European Union (EU) suffered an even sharper contraction, plunging 13.1% to $830 million. Geopolitical friction severely disrupted traditional Asian and Middle Eastern trade routes, causing vehicle exports to those regions to plummet by 31.7% ($470 million) and 38.7% ($270 million), respectively.

Despite these widespread downturns, South Korean automakers found silver linings in alternative markets. Outbound shipments to Central and South America jumped 23.7% to $290 million, while exports to Oceania grew by 20.1% to $360 million.

Eco-Friendly Exports Offer a Silver Lining
Even as overall export numbers contracted, foreign demand for South Korean eco-friendly vehicles remained robust. Total eco-friendly vehicle exports rose 22.8% year-on-year to 90,508 units.

Hybrid models spearheaded this external growth, surging 24.5% to 58,046 units and accounting for a dominant 64% of all eco-friendly vehicle exports. Pure electric vehicle exports also posted strong gains, expanding 42.6% to 30,198 units. On the other hand, plug-in hybrid electric vehicle (PHEV) exports suffered a major setback, collapsing by 61.7% to just 2,259 units.

Industry analysts note that while the domestic thirst for electric vehicles provides temporary relief for automakers, long-term sustainability will depend heavily on how South Korean companies navigate rising protectionism in Western markets and stabilize logistics amid worsening global conflicts.