VFACTS 2023: Chinese cars now a dominant force in Australia

China overtook South Korea to become the third most popular country of origin for new vehicle sales in Australia in 2023, boosted by new brands and established car-makers that are now sourcing cars – increasingly EVs – from the Asian powerhouse.

Almost 200,000 new cars sold in Australia last year were built in China – 193,433, to be exact – which is 70,500 more than in 2022 and was enough to overtake South Korea (161,614) for the first time.

That represents year-on-year growth of 57.5 per cent, compared to just a 1.5 per cent uptick for Korea and 4.5 and 7.6 per cent for Japan and Thailand respectively – the only two countries now ahead of China, which is rapidly closing in.

With Japanese-built cars at 345,071 sales in Australia last year, and Thailand at 264,253, there’s still some way for China to go.

That’s especially the case given Toyota’s dominance of the Australian market, the prominence of other Japanese brands among the top dozen Down Under and Thailand’s status as the manufacturing base for the vastly popular utes sold in our market, including the top three best-selling new vehicles here last year: Ford Ranger, Toyota HiLux and Isuzu D-MAX.

But consider that only 10 years ago, Chinese-built cars accounted for just 7000 sales in 2013 – for a 0.6 per cent share – in a similarly buoyant market (1.136 million), whereas last year that circa-200,000 figure brought China’s share to 16 per cent of the record 1.217m new cars sold in Australia.

The two biggest-selling electric cars, the Chinese-built Tesla Model Y (28,769) and Model 3 (17,347), accounted for more than 46,000 of those, with the Model Y standing with the MG ZS (29,258) as two of the three most popular SUVs – the most sought-after vehicle category in Australia, accounting for 56 per cent of all sales.

Only a late surge from the Toyota RAV4 (29,627) prevented the two Chinese-built SUVs taking first and second.

Both Tesla and MG were also among the top 10 brands in Australia last year, MG finishing seventh with 58,346 sales (+17.7%) – topping the small SUV (MG ZS) and light car segments (MG3) into the bargain – while Tesla’s incredible surge up the charts took it to eighth with 46,116 sales, up 135.4 per cent year-on-year.

Model 3 was the number-one medium-size passenger car and Model Y second only to RAV4 in the top-selling mid-size SUV segment.

GWM, which now trades with GWM Ute, Haval, Ora and Tank brands, is also moving up the charts, finishing 13th in 2023 with 36,397 sales (+45.3%), while LDV was 16th with 21,298 (+30.4%) – not bad going when there’s now 50 brands (not including heavy commercial) active in the marketplace.

The leading Chinese car-makers far outsold big-name brands such as Honda (13,743) and Suzuki (17,078), while newcomers such as BYD – with 12,438 sales last year (+488.6%) – and Chery, already with 5890 sales in the bank after launching in March 2023, are making their presence felt and targeting much higher volumes in the years ahead.

BYD outsold the likes of Renault (8024) and Skoda (7999) last year, while Chery was ahead of brands such as Peugeot (2506) and Jeep (4634).

China’s growing importance is not simply about budget cars, either, as it is fast becoming the global hub for electric vehicle manufacturing – including for prestige brands.

Looking beyond Tesla, Polestar is also on the rise and last year found 2463 new homes in Australia (+61.6%) for its Chinese-built sports-luxury EVs – a range that will soon expand into new segments – while Volvo, which sources a variety of cars from China including the XC60, XC40 and C40 Recharge, also posted record sales in 2023 (11,128, +3.9%).

The BMW iX3 and Citroen CX 5 are examples of other European cars now being sourced from China for sale in Australia, while Volkswagen is just one of several brands that are expected – if not already confirmed – to offer Chinese-built cars here in the next few years.

And the Aussie market is also seen as the perfect pitch for an influx of more Chinese brands – Lynk & Co, Zeekr, Radar, Geometry (all part of the Geely Group), GAC Motor, JAC, Nio, Neta, the list goes on…

Top 10 countries of origin for new car sales in 2023: