Chinese car brands are taking an ever-larger share of Australia’s new car market, but accounting firm BDO has warned the current pace of dealer expansion is unlikely to be sustainable.
Presenting at the Australian Automotive Dealer Association (AADA) event today, BDO automotive partner Sam Venn said Chinese automakers accounted for 24 percent of the market in the first two months of 2026, up from 14 percent in the same period last year.
This growth came quickly. A market report from BDO states that consolidated Chinese car manufacturers grew by 62 percent compared to the previous year. During the same period, the overall market shrank 2 percent, or about 3,200 units, while Toyota and Mazda volumes fell 6.5 percent, or 11,725 units.
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This is a significant change in a market that doesn’t typically move so quickly. This also helps explain why dealers are struggling to secure representation for new Chinese brands and sub-brands even as more traditional franchises face pressure from pricing, model changes and lower gross revenues.
But Mr. Venn’s broader message was that the headlines only tell part of the story. The more important question is whether the current number of brands, distribution structures and dealer points can actually enable profitable returns in the medium term. In this regard, BDO’s opinion was blunt.
“It’s not sustainable. It’s as simple as that,” he said.
The clearest evidence comes from BDO’s umbrella efficiency analysis (sales per dealer per month), which compares established brands with Chinese newcomers based on new car sales data from December 2025. Below are the numbers shared by BDO:
| Traditional brands | Dealer | Volume 2025 | Average monthly sales per dealer |
|---|---|---|---|
| Toyota | 276 | 239,863 | 72 |
| Mazda | 141 | 91,923 | 54 |
| Light up | 144 | 82,105 | 48 |
| BMW | 48 | 26,842 | 47 |
| ford | 194 | 94,399 | 41 |
| Hyundai | 166 | 77,208 | 39 |
| Mercedes Benz | 63 | 22,850 | 30 |
| Mitsubishi | 189 | 61,198 | 27 |
| Subaru | 119 | 39,005 | 27 |
| Volkswagen | 102 | 28,970 | 24 |
| Average | — | — | 41 |
| Chinese brands | Dealer | Volume 2025 | Average monthly sales per dealer |
|---|---|---|---|
| BYD | 91 | 52,415 | 48 |
| Chery | 86 | 43,121 | 42 |
| GWM | 120 | 52,415 | 36 |
| MG | 115 | 39,005 | 28 |
| Zeekr | 12 | 3271 | 23 |
| LDV | 96 | 7239 | 9 |
| Geely | 43 | 5010 | 7 |
| jump motor | 12 | 644 | 4 |
| JAC | 46 | 1541 | 3 |
| Deepal | 18 | 520 | 2 |
Among traditional players, Toyota averaged 72 sales per roof per month, Mazda 54, Kia 48, BMW 47, Ford 41, Hyundai 39, Mercedes-Benz 30, Mitsubishi 27, Subaru 27 and Volkswagen 24. The top 10 average was 41.
On the Chinese side, some brands are already operating at a comparable level. BYD had 48 sales per roof per month, Chery had 42 and GWM had 36. MG had 28.
After that the picture changed quickly. Zeekr was shown at #23, LDV at #9, Geely at #7, Leapmotor at #4, JAC at #3 and Deepal at #2.
Established networks typically have sophisticated financial, customer service and service processes. This back-end supports the company when front-end margins come under pressure, which is already the case in much of the market.
A new plaque on the building can add volume, but it also comes with real costs. Dealers must fund facilities, staffing, marketing, inventory and local brand building before the company has proven it can generate sustainable revenue from parts and service.
BDO’s own slide presentation makes this trade-off clear, describing it as a “front-end versus back-end trade-off for existing dealers looking to trade with OEMs,” but also notes that return on investment from capital expenditures is critical.
The big Chinese brands are not all in the same situation. Mr. Venn’s presentation suggests that the bigger names are already maturing and starting to build the backend, while the long tail still has a way to go. This is an important difference because the top of the Chinese market is gradually becoming structurally different from the bottom.
The other big risk lies abroad. BDO’s presentation argued that there are still too many automakers in China, with well over 150 operating domestically. It says it is widely believed that the number should be reduced significantly to achieve financial sustainability without significant government support.
The reasons are not difficult to understand. According to BDO, China’s electric vehicle price wars have been brutal, margins have collapsed, oversupply has hurt weaker brands and government policy is shifting from supporting industry losses to technological consolidation, mergers and better integration of research, development and supply chains.
This has a direct impact on Australia. According to BDO, the likely survivors will be the larger, vertically integrated corporations with EV technology, scale and established export networks, citing BYD, Geely, SAIC Motor (MG), GWM and Chery as examples.
For Australian retailers, the risk isn’t just that some brands will fail, the bigger issue is what happens when Chinese parent companies start merging brands, changing distribution structures or streamlining overlapping dealer networks.
The dealers were threatened with brand closures, distribution changes and a forced realignment of the franchise. If a Chinese parent company merges two brands, dealer networks could be eliminated entirely.
This is not a prediction from BDO that every smaller Chinese brand will disappear – in fact, we would argue that it is more likely that some of the established European and Japanese brands will leave our market instead – but nonetheless it is a warning that the investment decisions retailers are making today are being made in a market that could look very different in three to five years.
This risk is also increased by how quickly the product page changes.
BDO says surviving brands are likely to expand aggressively, with fast model cycles laying the foundation for more launches in Australia, faster price competition and potentially more factory-controlled distribution networks.
In other words, the brands that make it could become even tougher competitors than they already are.
If Chinese brands just offered more choice, the story would be simple. But they are also changing pricing, forcing existing brands to respond and luring retailers into a wave of investment that BDO says could outlive some of the brands themselves.
This is also consistent with the message that AADA has spread. In its media release today, the dealer association said 28 brands had entered Australia in the last five years, but this increase had not translated into increased dealer profits. It warned that the industry does not want to end up in a situation where retailers close and local jobs are lost.
Chinese brands are now too big to be treated as fringe players. The top end is already becoming part of the mainstream market. But the current land grab across all brands, sub-brands and retailers is a different matter entirely. Some of these bets will pay off, but others almost certainly won’t.
