Chinese SUVs gaining traction as European brands experience sales downturn

08/09/2024 12:00 PM

Chinese car brands are starting to make a dent in Australia's most popular vehicle segment by taking sales away from European brands, new figures show.

In July, according to VFACTS data released by the Federal Chamber of Automotive Industries (FCAI), Chinese brands such as BYD and Chery posted strong growth for the month and year so far, while GWM also finished in the top 10 best-selling brands.

Year-to-date, BYD is up 57 per cent compared to 2023, Chery is up 128 per cent, and GWM up 24 per cent.

In Australia's favourite vehicle segment – medium SUVs, which makes up 20 per cent of the new car market  – the same thing is playing out, with models originating from China starting to cannibalise sales from long-term household names.

The most interesting activity has been in the sub-$60,000 class, in which the recently-introduced BYD Sealion 6plug-in hybrid notched up 556 sales last month alone, making for a 1038 total for the year so far, and taking a three per cent share of the segment – while there were also 300 examples of the new Chery Tiggo 7 Pro sold (1434 year-to-date) taking 1.5 per cent of the pie.

GWM also shifted 849 Haval H6/H6 GT cars last month, giving it more than four per cent of the market.

The only anomaly among the Chinese cars being the BYD Atto 3, which was down 57 per cent in July, likely due to an incoming update – and even then it holds a three per cent share for 2024 to date.

While these numbers are on the lower side when stacked up against segment leaders – such as the Toyota RAV4, Mitsubishi Outlander and Mazda CX-5 – the impact is being felt outside of these names, with sales down for many European brands, as well as the likes of Ford and Honda.

The RAV4 – the best-selling car in Australia last month overall with 5933 units sold – took 30 per cent of the share for July and 24 per cent year-to-date.

Meanwhile, the Outlander took 11 per cent last month (13 per cent YTD), and the CX-5 held 10 per cent (11 per cent YTD).

Take those big performers away, and other household names aren't fairing so well.

Ford's Escape is down 80 per cent this year so far after being discontinued last year, with just 15 sales from remaining stock in July giving it a 0.1 share of the market, Honda's CR-V is down 27 per cent for 2024 with the 471 cars sold last month amounting to a 2.4 per cent share, and the Peugeot 3008 is 10 per cent down, posting 51 vehicles sold in July equalling a 0.3 per cent slice.

Likewise, the Renault Koleos is 69 per cent worse off so far in 2024 than it was this time last year, with 93 cars sold in July giving it a 0.5 per cent stake, Skoda's Karoq is down 41 per cent, having shifted 66 vehicles last month for a 0.3 share of the market, and Volkswagen's Tiguan has dropped 36 per cent, with 324 sales and a two per cent share.

The shift comes as Chinese brands celebrate a new milestone in Australia, having now been in local showrooms for 15 years.

The first Chinese car manufacturer to set up shop in Australia was Great Wall Motors (GWM), which launched in June 2009 with a pair of utes.

China is now comfortably the third-biggest source of new motor vehicles sold in Australia, overtaking South Korea, the US and Germany in recent years – and behind only Japan and Thailand.

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