Chinese car makers now look set to supply almost six in 10 imported vehicles to Australia within a decade, a far bigger share than previously expected. New research commissioned by the Australian Automotive Dealer Association points to China holding 58% of vehicle imports by 2035, up sharply from a 43% forecast in a Centre for International Economics report released in July last year.
Dealers describe the sector as going through a historic upheaval, driven by shifting customer tastes, rapid technology change and a flood of new brands. Chinese manufacturers are taking advantage of softer demand at home by pushing aggressively priced models into markets like Australia.
China recently overtook Japan as Australia’s largest vehicle source country, ending Japan’s 28-year run at the top. Thailand, South Korea and European suppliers still hold meaningful slices of the import market.
In June, BYD, China’s biggest car maker, came close to dislodging Toyota as Australia’s best-selling brand, a spot Toyota has held since 2003. Just 243 vehicle sales separated the two companies, underscoring how quickly Chinese entrants are closing the gap.
The AADA’s latest projections show China controlling about 58% of new car sales by 2035, equivalent to nearly 900,000 vehicles a year. That is a substantial jump from the Centre for International Economics’ earlier estimate of a 43% share.
Much of the momentum stems from BYD, MG and other electric-focused brands, which have kept sales humming even after Middle East conflict pushed oil to around $US100 a barrel and sent fuel prices sharply higher. June sales data was a turning point, with electric vehicles grabbing a 35.8% market share according to the Electric Vehicle Council, reinforcing to analysts that the trend is entrenched rather than a blip.
Australia’s dealer body also anticipates fiercer competition as more global manufacturers try to tap a booming market that increasingly favours electrified and lower-cost imports. The AADA expects the number of brands operating locally to rise from 67 today to about 75 by 2031.
That influx looks set to pressure prices and margins while giving buyers more choice across segments, from budget city runabouts to premium EVs. The rapid rise of Chinese automakers is forcing established Japanese, Korean and European players to rethink their product mix, pricing and technology rollouts for Australia.
