The boss of Suzuki Motor Corporation’s distributor in Queensland and northern Latest South Wales predicts some automotive brands will withdraw from the Australian market, including a few of the newer Chinese entrants.
“I feel there’ll definitely be brands that don’t make it [in Australia]. I feel there’ll be brands in China that won’t last – they’re cutting one another’s throats over there in the mean time already,” the overall manager of Suzuki Auto Co, Paul Dillon, told CarExpert.
“For those who consult with [Pitcher Partners automotive analyst] Steve Bragg, any individual like that in that a part of the industry, their advice to dealers is simply to be very careful about which Chinese brands they tackle and spend money developing their dealership for. Are they going to be there in the long run?
“We’ve already seen Chinese brands are available and go previously.”
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Indeed, the primary wave of Chinese brands from 2009 into the 2010s saw various brands come but eventually go, including JMC and ZX Auto.
That wave also included the primary attempts within the Australian market by Chery and Geely, each of which left but have re-entered this decade with factory-backed operations.
And as Mr Dillon notes, some Chinese brands have even failed or appear near death in their very own market, including HiPhi, Hycan and Weltmeister, and the Evergrande Group-owned Hengchi.
The newest deluge of Chinese brands into Australia has far surpassed that of this earlier era in our market’s, nevertheless.
In 2023, Chery returned to the Australian market to affix existing existing players BYD, GWM and MG.
Above (clockwise from left): Geely EX5, GAC GS3 Emzoom, Leapmotor C10, Chery Tiggo 4
Leapmotor, Deepal, JAC, Xpeng and Zeekr followed in 2024, with Geely and Omoda Jaecoo commencing deliveries this yr, and Foton soon to offer it one other crack after having previously exited our market.
GAC can be set to enter the Australian market this yr, and much more brands are expected to come back. That can see well over 60 brands competing for a market that, in comparison with more populous nations just like the US, is small fry – around 1.2 million vehicles were sold here last yr.
Almost all the latest brands entering our market come from China, with automakers from that nation desperate to enter the fray here.
They’re doing so in lots of cases not only to eke out a share of the Australian market, but in addition to make use of our market as a test bed for other markets (as Chery has confirmed) and to assist bolster their global presence – something particularly crucial as competition amongst Chinese brands of their home market becomes ever more brutal.
They’re also typically coming here with sharp pricing that undercuts established brands from Japan, South Korea and other countries.
A lot of those Chinese brands “undoubtedly” pose a threat to legacy brands like Suzuki, said Mr Dillon.
“The laws’s almost leaning towards them, isn’t it?” he added, referring to the federal government’s Latest Vehicle Efficiency Standard (NVES) emissions scheme, which he argued was poorly thought-out.
“If you see if the NVES has the impact that it probably can have, does that mean all the pieces else apart from the Chinese stuff starts getting dearer?
“It doesn’t mean that over the subsequent two years there’s going to be a dip within the national sales of cars. Will we go from 1.1 million to a number lower than that, once the shock of price increases?
“That said, taking a look at the recent VFACTS, a few of their brands are definitely rapidly increasing in volume but the general Chinese share of the national market isn’t increasing that quickly I don’t think.
“There are still some folks that prefer to stick with a legacy brand.”
Sales of vehicles inbuilt China were up by 8.6 per cent in 2024, after having overtaken sales of Korean-built cars in 2022.
But while brands like BYD and Chery have soared, overall sales growth for Chinese-built cars isn’t as impressive because it was in 2023, when their sales increased by 57.5 per cent, or in 2022 once they rose by 61 per cent.
And since 2021, Suzuki has managed to take care of a complete share of our market of between 1.4 and a pair of.0 per cent, though this yr it might struggle because of interrupted supply of key vehicles just like the Jimny.
Suzuki finished sixteenth overall in our market in 2024 with 21,278 deliveries, ending behind Chinese brands MG (seventh place, 50,592 deliveries) and GWM (tenth, 42,782 deliveries) and just ahead of BYD (seventeenth, 20,458 deliveries).
To date this yr, Suzuki is behind all three of those brands, plus Chery. It’s sitting at 9653 deliveries, down 21 per cent year-to-date, while Chery has overtaken it with 17,272 deliveries, up 235.2 per cent.
Moving forward, Suzuki will even have to regulate rapid risers like Geely in its rear-view mirror, while latest entrants like GAC can be competing in a few of the same segments because the Japanese brand.
Suzuki Australia, which manages the sale and distribution of Suzuki vehicles in every single place in Australia bar Queensland and the Northern Rivers region of NSW, says it won’t start a price battle with purveyors of reasonably priced Chinese vehicles.
“We provide products which might be good value for money that might be applicable to most buyer types all over the world. And that’s a part of Suzuki’s philosophy: to supply a automotive for everyone,” Suzuki Australia general manager Michael Pachota told CarExpert.
“With that said, there’s no compromise ever on quality, so that you get what you pay for.
“With respect to that, I don’t think it’s a race to the bottom price if a competitor is down there. It’s based on producing a vehicle that’s right for the patron, and it’s a top quality product with none compromise.
“We own our lane. We’re good in it. We’re the small-car specialists, and we deliver – and I keep saying it – undeniably reliable, quality product.”
This Article First Appeared At www.carexpert.com.au
