Chinese car brands are experiencing a surge in popularity across South Africa, defying market challenges.
While the first quarter of 2024 showed new vehicle sales in the country declined by 5.6% compared to the same period in 2023, the number of Chinese cars financed by Standard Bank Vehicle Finance has consistently shown an increase year-on-year.
Brandon Cohen, Chairperson of the National Automobile Dealers Association (NADA) joins Refilwe Moloto on Kaya Biz to dissect why Chinese vehicles are gaining popularity in South Africa while the sales of 3 dominant luxury vehicles, namely BMW, Audi and Mercedes Benz have drastically declined over the past 10-years.
Chinese car brands are now outpacing legacy brands like Mazda, Land Rover and Volvo.
One of the reasons is that Chinese vehicles have a central focus on affordability and value for money, with brands like Haval and GWM offering luxury for a reasonable price, compared to other luxury brands.
GWM Haval, is the most popular Chinese brand financed by Standard Bank since 2022, followed by Chery and BAIC.
Sales of these vehicles increased from just over 6% in 2022 to 7.4% in the first half of 2024.
The Automotive Business Council’s quarterly reviews confirm that year-on-year new vehicle sales have been declining since the third quarter of 2023.
In the second quarter of 2024, new vehicle sales dropped by 9.6% compared to the corresponding quarter in 2023 (alternatively, we can quote a quarter-on-quarter decline of 12.1% from Q1 2024). During this same period, Standard Bank Vehicle Finance financed more new Chinese car brands.
These Chinese cars find particular favour in Gauteng, where Standard Bank concluded 54% of Chinese car brand deals. KwaZulu Natal (18%) and Western Cape (10%) also contribute to their growing presence.
Source: KAYA959
