Market Insight: Newbies capture market

ONE clear sign of resilience in the Australian new-car industry has been its ability to not only survive a pandemic but also have the strength to welcome several new brands to the market.

In fact, over the past nine years, Australia has added 10 new car brands to bring the total number – listed in VFACTS – to 53.

Crucially, those 10 brands now represent 17 per cent of the total car market.

The majority of these brands are Chinese while vehicles from a further two – Polestar and Tesla – are made in China for this market.

It is, therefore, no surprise that cars originating in China now have a substantial share of the Australian market. At the end of the first five months of 2023, that share is 15.9 per cent.

The four brands that came into the Australian market during the pandemic were BYD (2022), Chery (2023), Cupra (2022) and Polestar (2022), adding to appearances made in the nine years since 2014 by MG (2017 and now with a market share of 4.5 per cent); LDV (2014); Chevrolet (2018); Genesis (2019); and Tesla (2014).

Great Wall Motors (GWM), which returned to Australia as a factory-owned operation in 2016 before gathering momentum in 2020 with new-generation products, has also introduced its Haval, Tank and Ora brands under the GWM umbrella. The current GWM ute and latest-generation Haval SUV range have also found success since rolling out during the depths of the pandemic in late 2020 and early 2021.

Most of these newcomers have hit the proverbial nail on the head, selling in strong numbers and adding to the national dealership count, employing more people and through this, aiding the economy.

SAIC subsidiary brand of MG hit the Australian market running and in its first year of 2017, sold 600 units. 

Ironically, the MG6 that caught the most attention and the most sales, was dropped by the company within two years. Taking buyer interest was the new ZS SUV and hatchback, the MG3, which in 2019 sold 3729 and 4017 units respectively, pushing MG to a 0.8 per cent market share.

Clearly the sales impetus was a seven-year unlimited distance warranty and a $15,990 (MG3 Core) starting price with automatic transmission. The ZS started at $20,990.

Despite the pandemic and all its repercussions, by 2022 MG managed to sell 49,582 units in Australia and had seized a 4.6 per cent slice of the market, significantly ahead of established brands including Nissan, Volkswagen and Subaru. 

MG now has three models, including variants such as its all-electric ZS (and adds another with the upcoming all-electric MG4 small hatch), and now sells almost four times the volume as Honda – all from a company that entered Australia barely five years previously.

LDV is another brand that shows how quick an unknown brand in Australia can grab buyer attention. It came into the market in 2014 with 214 sales and by 2019, sold 6480 units.

The two-model brand – it sells a dual-cab 4x4 ute and a 4x4 SUV – has sold 8490 in the five months of 2023, up 38.3 per cent on the corresponding period in 2022.

It has a 1.9 per cent market share, just less than BMW’s place on the new-car market.

Genesis, the upmarket luxury brand created by Hyundai, is another newbie that while not reaching the rarified air of the budget Chinese brands, has scored well and has a long future with a raft of new models proposed for launch.

Here in 2019, it uses direct sales and specialist shopping centre boutique outlets along with the Hyundai network for service backup to start at 103 sales in its first year.

It recorded 1039 sales in 2022 and in the first five months of 2023, has found 633 new owners.

Polestar, part of Chinese conglomerate Geely, launched in 2022 and has since sold 2420 units, of which 896 were delivered in the five months of this year. It currently has one model, the Polestar 2, and adds more products in 2024.

Cupra, part of the Volkswagen Group and with production in Spain, also opened in Australia in 2022 and has sold 2338 units; Chevrolet is sold through GMSV and has utes and the Corvette (1261 sold this year); while BYD is accelerating its sales with 6777 since 2022 with its single EV model, the Atto3, to be joined by the smaller EV, the Dolphin.

No list of newcomers would be complete without Tesla that single-handedly revitalised the once languishing Australian medium sedan market.

The Tesla 3 has a commanding 49 per cent of the total mid-size passenger car sector with 10,117 sales this year – almost four times that of the next best-seller, the Toyota Camry – while the Model Y medium SUV is replicating that success, selling 8717 in its first year of 2022 and an additional 8442 in the first five months of 2023.