Chinese car brands are taking an ever-larger slice of the Australian new-vehicle market, but accounting firm BDO has warned the current pace of dealer expansion is unlikely to be sustainable.
Presenting at today’s Australian Automotive Dealer Association (AADA) event, BDO automotive partner Sam Venn said Chinese automakers accounted for 24 per cent of the market over the first two months of 2026, up from 14 per cent at the same time last year.
That growth has come fast. One of BDO’s market slides says Chinese automakers, when consolidated, were up 62 per cent year-on-year. Over the same period, the overall market contracted by 2 per cent, or about 3200 units, while Toyota and Mazda volume was down 6.5 per cent, or 11,725 units.
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That’s a meaningful shift in a market that usually doesn’t move this quickly. It also helps explain why dealers are scrambling to secure representation for new Chinese brands and sub-brands, even as more traditional franchises come under pressure from pricing, model changeovers and lower front-end gross.
But Mr Venn’s broader message was that volume headlines only tell part of the story. The more important question is whether the current number of brands, distributor structures and dealer points can actually support viable returns over the medium term. On that front, BDO’s view was blunt.
“It’s not sustainable. It’s as simple as that,” he said.
The clearest evidence sits in BDO’s rooftop efficiency slide (sales per dealer per month), which compared established brands with Chinese new entrants based on December 2025 new car sales figure data. Below are figures shared by BDO:
| Traditional brands | Dealers | 2025 volume | Avg monthly sales per dealer |
|---|---|---|---|
| Toyota | 276 | 239,863 | 72 |
| Mazda | 141 | 91,923 | 54 |
| Kia | 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 | Dealers | 2025 volume | Avg 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 |
| Leapmotor | 12 | 644 | 4 |
| JAC | 46 | 1541 | 3 |
| Deepal | 18 | 520 | 2 |
Among the traditional players, Toyota averaged 72 sales per rooftop 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 was shown at 48 sales per rooftop per month, Chery 42 and GWM 36. MG came in at 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 tend to have mature finance, aftersales and service operations behind them. That back end is what supports the business when front-end margins get squeezed, which is already happening across much of the market.
A new badge on the building can bring fresh volume, but it also comes with real cost. Dealers need to fund facilities, staff, marketing, stock and local brand-building, all before the business has proven it can generate sustainable revenue through parts and service.
BDO’s own slide deck makes that trade-off explicit, describing it as a “front-end v back-end trade-off for existing dealers looking to trade OEMs”, while also warning that return on investment from facility spend is critical.
The major Chinese brands are not all in the same position. Mr Venn’s presentation suggests the bigger names are already maturing and starting to build out the back end, while the long tail still has a fair way to go. That’s an important distinction, because the top of the Chinese market is starting to look structurally different from the bottom.
The other big risk sits offshore. BDO’s presentation argued that China still has too many automakers, with well more than 150 operating domestically. It says that number is widely tipped to reduce substantially in order to achieve financial sustainability without substantial government support.
The reasons aren’t hard to follow. BDO says Chinese EV price wars have been brutal, margins have collapsed, oversupply has hurt weaker brands and government policy is shifting away from propping up industry losses and towards technological consolidation, mergers, and better integration of research, development and supply chains.
That has direct implications for Australia. According to BDO, the likely survivors will be the larger, vertically integrated groups with EV technology, scale and established export networks, naming BYD, Geely, SAIC Motor (MG), GWM and Chery as examples.
For Australian dealers, the risk is not just that some brands may fail, the bigger issue is what happens if Chinese parent companies start merging brands, changing distributor structures or rationalising overlapping dealer networks.
Dealers could face brand closures, distributor changes and forced franchise realignment. If a Chinese parent merges two brands, dealership networks could be eliminated entirely.
That isn’t a prediction by BDO that every smaller Chinese brand will disappear – in fact, we’d argue it’s more likely for some of the established European and Japanese brands to leave our market instead – but nonetheless it’s a warning that dealer investment decisions made today are being taken in a market that may look very different in three to five years.
That risk is also compounded by how quickly the product side is moving.
BDO says surviving brands are likely to expand aggressively, with rapid model cycles underpinning more launches in Australia, faster price competition and potentially more factory-controlled sales networks.
In other words, the brands that make it through may become even tougher competitors than they already are.
If Chinese brands were merely adding choice, the story would be straightforward. But they’re also reshaping pricing, forcing existing brands to respond, and drawing dealers into a wave of investment that BDO suggests may outlast some of the brands themselves.
That also lines up with the message AADA has been pushing. In its media release today, the dealer body said 28 brands have entered Australia in the past five years, but that increase hasn’t translated into higher dealer profits. It warned the industry doesn’t want to end up in a position where dealerships close and local jobs are lost.
Chinese brands are now too large to be treated as fringe players. The top end is already becoming part of the mainstream market. But the current land grab across every badge, sub-brand and dealer point is another matter entirely. Some of those bets will pay off but undoubtedly some almost certainly will not.