BYD and other Chinese automakers have been steadily bringing new electric models to Australia, a market where they face no trade barriers and sales have soared thanks to local government incentives for electric vehicles and soaring petrol prices.
Since taking office in 2022, Australian Prime Minister Anthony Albanese has been aggressively promoting the use of electric vehicles as part of his plan to cut the country's greenhouse gas emissions.
That has created a strong tailwind for electric vehicle demand in the Oceania nation, with electric vehicles accounting for 7.2% of new car sales in Australia by 2023, up from 3.1% the year before.
Although Australia is a relatively small market on a global scale with 1.2 million cars sold last year, it is a very attractive market for Chinese automakers because the “Kangaroo country” has no car manufacturing industry and has an open trade policy.
For example, Chinese startup Leapmotor has partnered with renowned carmaker Stellantis to expand globally. The Chinese electric carmaker has designated Australia as a priority market, knowing that there are no local automakers there.
While Tesla is the global leader in electric vehicles, it is the Chinese manufacturers in the lower-end segment that are the most formidable “competitors” to long-standing carmakers in Australia such as Toyota and Ford, brands associated with traditional petrol vehicles.
Showroom of Chinese electric car maker BYD in Sydney, Australia. Photo: Which Car
Last year, sales of electric vehicle giant BYD, which entered the market in 2022, surged nearly sixfold to more than 12,000 vehicles. Data from the Federal Automotive Industry Chamber shows the Warren Buffett-backed automaker now accounts for 14% of Australia’s electric vehicle market, behind Tesla’s 53%.
“The opportunity is clear,” said David Smitherman, managing director at EVDirect, BYD’s Australian distributor. “We now need to penetrate the mass market, because we’ve already sold to early adopters and enthusiasts.”
BYD will add two SUVs and a pickup truck to its Australian lineup this year, bringing its total to six, Mr Smitherman said. EVDirect will also open 30 more dealerships in the next 18 months, bringing its total to 55, and has already begun selling vehicles to companies such as Uber.
China's state-owned SAIC Motor will launch three new models this year under the MG brand, including the MG3 plug-in hybrid and MG Cyberstar electric roadster, bringing its total EV/hybrid product line-up in Australia to five.
Long-standing carmakers in Australia are no slouches either. Ford, for example, has two electric vehicles in the market and three more in the pipeline, according to a company spokesperson.
Toyota has launched its first electric car, along with nine hybrid models, in Australia. The hybrids emit lower emissions than their petrol equivalents. The Japanese car giant said it was confident in its strategy of offering a wide range of hybrids while steadily growing its battery electric vehicles.
The Australian government has introduced a range of incentives to boost demand for electric vehicles, including tax breaks and rebates. Several states have also set ambitious electrification targets and are investing in charging infrastructure to help drive the transition.
There are high expectations that demand for electric vehicles in Australia will continue to grow, although forecasts vary. PwC estimates that half of new car sales in Australia will be electric by 2027. Fitch Ratings predicts that figure will be 18% by 2032 .
Minh Duc (According to Reuters, Republic World)
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