According to data from the Federal Chamber of Automotive Industries (FCAI), China officially became the largest source of new car imports for Australia in February, ending Japan’s long-standing dominance that had persisted since 1998.
Chinese automakers are making rapid strides in the overseas market, now capturing a quarter of the Australian market share. In February alone, 22,300 vehicles from China were sold in Australia, accounting for approximately 25% of the market. Japan and Thailand followed with 21,600 and 19,400 units, respectively. Projections suggest that China’s market share could climb to 43% by 2035—a remarkable shift considering that just a decade ago, the Australian market was almost exclusively dominated by Japanese and South Korean brands.
During the first two months of 2026, the top three best-selling brands in Australia were Toyota, Mazda, and Kia. However, Toyota saw a 24.9% year-on-year decline in sales to 27,900 units, and Mazda fell 13.9% to 14,700 units, while Kia bucked the trend with a 7% increase to 13,300 units.
Cost efficiency remains a primary driver for Chinese manufacturers. Over the past decade, production costs for Chinese automakers have steadily declined, providing a significant competitive edge in global expansion. Currently, four Chinese brands—BYD, GWM, Chery, and MG—have secured spots in Australia’s top ten best-selling brands list.
BYD leads the charge among Chinese brands, with sales surging 160% to 10,200 units. GWM and Chery also reported impressive growth, with sales increasing by 27% and 99%, respectively.
Australia’s automotive market, while mid-sized with over one million annual sales, lacks a large-scale domestic manufacturing industry, making it heavily reliant on imports. This low barrier to entry has made it a key battleground for international brands. Since 2020, ten new automotive brands have entered the Australian market, nine of which are from China, including BYD, Geely, Xpeng, Leapmotor, and Zeekr.
It is important to note that “Made in China” does not always equate to a “Chinese brand.” In the era of electric vehicles, China has become a core manufacturing hub for global automakers, with companies like Tesla, BMW, and Kia exporting vehicles produced in China to the Australian market.
Australian consumers show a strong preference for SUVs and pickup trucks. Chinese automakers have successfully capitalized on this by offering cost-effective SUVs that excel in intelligence and electrification. Furthermore, Chinese manufacturers have become a major catalyst for the growth of Australia’s new energy vehicle (NEV) market. In 2025, sales of pure electric vehicles in Australia reached 103,000 units (up 13.1%), while plug-in hybrid sales hit 53,000 units (up 130%).
While Tesla remains a leader in the Australian EV market, its dominance is being challenged. Data from CarExpert shows that in 2025, Tesla’s sales in Australia fell 24.8% to 28,000 units, while BYD’s sales grew by 77.3% to 25,000 units. BYD has also become a dominant force in the plug-in hybrid segment, capturing a 50% market share in 2025, far ahead of Mitsubishi’s 10%.
