Volvo boss says Chinese brands are winning in Australia

Australia's new-car market has quietly passed a point of no return. In August, more new vehicles delivered here were built in China than anywhere else on earth – Japan included – and one of the executives watching it happen up close reckons the newcomers have earned those sales.

Speaking on the Story Work podcast, Volvo Car Australia managing director Stephen Connor was refreshingly blunt about the Chinese surge, the pressure it's applying to legacy brands, and the fight now playing out inside dealerships rather than showroom floors.

China’s is dominating sales in Australia and across many export markets. The sales acceleration and consumer acceptance has been swift and Stephen Connor, whose brand is itself owned by Geely, isn't inclined to sook about it.

Explaining the current sales climate in Australia to the Story Work podcast, Connor said Australia is “completely different” to most other markets in that Aussies love the latest and greatest tech.

“I would say that the Australian community is very much driven by being the first, they love technology, they love the design and desire to have a new brand.

“That's what's driving some of these brands that are coming from China and I have to say, hats off to them, they are amazing cars, they will have great safety and technology in their cars.

He cautioned that challenger brands products “…may not be as good as ours…” but noted that another element helping the China sales boom was sharp pricing.

“The other thing … driving it, the Chinese can make the cars cheaper than we can in Europe because they have newer factories, they have more people to run the factories.”

It should be noted that some Volvo cars are made in China, such as the EX30, which was the brands top selling car in Australia in August 2026.

“You then add that with the cost, three weeks on a boat [from China] is cheaper than nine weeks on the boat [from Europe]. So all of the signs are making it nice and enticing.”

Look at the sales numbers and it’s clear China is winning.

A total of 100,939 new car sales were tallied in August 2026, and 36,070 of those – better than one in three – rolled out of a Chinese factory.

Japan managed 24,892, down 12.8 per cent, while Thailand (15,658) and Korea (11,060) were third and fourth respectively.

Year to date, China sits on 244,855 against Japan's 195,614, a gap of nearly 50,000 units in a market that is otherwise dead flat.

Connor said that the real battle going forward will be with new car dealers just as much as it is with buyers and consumers.

"It's both really, because if you don't get an individual [at a new car showroom] who's clearly with you as a brand, then that transpires through to their people, then transpires through to the customer. So the customer doesn't get the experience that you want.”

He noted that getting cut-through with dealers is much harder nowadays because Chinese challenger brands bring a compelling business case to the table.

“It is very difficult at the moment trying to cut through, because all of the dealer principals or owners are faced with all the lovely new shiny toys that are coming out of China,” said Connor.

“And they're throwing oodles of support, financial support, both long-term and short-term, to the individuals to take on the brand. So we're fighting at the moment to retain our share of voice within the dealer principals, because again, if they've got seven brands, we're only one of seven.

"And actually, if you talk about volume, we've probably got a very small [amount], 10 per cent of their total volume [on average]. So we need focus.

“One thing we've learned is if we don't get their buy-in and their interaction, we struggle as a brand, and that emotional element we talked about earlier doesn't come across to our customers. So it's something we fight with every single day,” said the Volvo Australia boss.

Volvo's own ledger illustrates the squeeze. The Swedish brand delivered 582 vehicles in August, down 9.2 per cent year-on-year, for a year-to-date tally of 4711 – off 1.1 per cent on the same point in 2025.

That's a long way from Connor's stated goal of 12,000 sales a year by 2028, and from the brand's 11,128-unit high-water mark set in 2023.

The bright spots are electric. The XC40 remains Volvo's best-seller here on 1656 sales, but the EX30 has jumped 36.4 per cent to 1185 to claim second, edging out the XC60 on 1170.

There's a delicious wrinkle in that: the EX30, Volvo's fastest-growing model in Australia, is built in China.

Recent additions include the ES90 electric sedan from $88,880 and the EX30 Cross Country at $69,990.

The heavy lifting falls to the Volvo EX60, landing between November and December from $86,990 for the rear-drive P6 and $101,990 for the dual-motor P10.

Volvo expects it to add roughly 2000 to 2500 sales a year on its own.

Having driven it in Spain earlier this year, we can report it is an impressive rig and scored a very strong 85/100. It also happens to be built in Sweden.

Whether Swedish substance is enough against Chinese momentum is the question Volvo Australia must grapple with. On August's evidence, the shiny new toys are still winning.

The biggest risk facing legacy car brands in Australia today? According to the Volvo Australia chief, it’s complacency.

“I think the biggest blind spot for all of us, and me on a personal level, is don't underestimate the level of change that's coming – or even here today.”

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