Bentley, Porsche, Rolls-Royce sales fall after the mandatory law of green plates on company cars.

Written by Lee Min-hyung

Bentley, Porsche and Rolls-Royce have seen their sales plummet in Korea since the government introduced a law mandating the attachment of license plates to company cars worth more than 80 million won ($57,800), according to data from company officials on Monday.

The changes came into effect at the beginning of 2024. The law – introduced by the Ministry of Lands, Infrastructure and Transport – aims to prevent business owners from buying large vehicles such as company cars to avoid tax.

Data from the Korea Automobile Importers and Distributors Association (KAIDA) showed the number of newly imported luxury cars registered here reached 3,868 in March, down 31.4 percent from a year earlier.

Most notable is the sharp fall in sales of the three automakers mentioned above here. The number of Bentley cars registered in Korea decreased by 77.4 percent in the first three months from last year. Rolls-Royce and Porsche also reported declines of 35.2 percent and 22.9 percent, respectively, during the period.

Green license for vehicles owned by a company worth more than 80 million shillings ($57,800) / Courtesy of the Ministry of Lands, Infrastructure and Transport

Company officials attributed the decline in demand for large luxury vehicles to the effects of green plates.

“In general, few customers or business owners prefer to buy cars with green plates due to the negative image that is spread about renting and leasing cars,” an official from the luxury car maker said. “This will weaken the general sentiment from business owners who plan to buy luxury vehicles such as fleet vehicles.”

Other data also showed that few business owners are buying luxury cars for company use. According to data from KAIDA, the share of registered company cars among the total number of cars imported here decreased significantly.

A total of 25,263 imported cars were registered in March, which is 6 percent from the previous year, but the share of company cars reached 28.4 percent. This is the first time that number has dropped below 30 percent. Last year, company-owned vehicles imported into the country accounted for nearly 40 percent of all registered vehicles.

Sales of Lamborghini cars also fell by 22.2 percent in the first quarter from a year ago, which was affected by the introduction of the green plate law on the luxury cars owned by the company. Lamborghini sold 90 percent of its vehicles as fleet vehicles in Korea last year. Rolls-Royce’s figure also came in at 87.3 percent at the same time. The figures for Bentley and Porsche reached 76 percent and 61.1 percent respectively.

Others in the industry said luxury car makers ended up suffering a sharp drop in sales due to a combination of the economic downturn and the introduction of the regulation.

“While the economy shows no immediate signs of recovery, demand for premium cars is slowing,” another official from a different manufacturer said.

“To make matters worse, the law also comes as a deterrent for such automakers to revive their declining sales performance here,” said another official from an imported automaker.