Chinese car brands accelerate in South Africa despite market challenges
Chinese car brands are experiencing a surge in popularity across South Africa, defying market challenges. Despite overall retail sales facing pressure, the number of Chinese cars financed by Standard Bank Vehicle Finance has consistently increased year-on-year since 2022.
Standard Bank’s sales data shows that the proportion of Chinese car brands increased from just over 6% in 2022 to 7.4% in the first half of 2024. Derick De Vries, Head of Automotive Retail at Standard Bank Vehicle and Asset Finance, says this quantum of growth is intriguing when especially considering the broader decline in new vehicle sales in the country.
“Even though Chinese brands currently represent less than 10% of our retail sales, their upward trajectory is remarkable given the challenging market conditions,” he says.
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.
GWM Haval, is the most popular Chinese brand financed by Standard Bank since 2022 followed by Chery and BAIC.
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.
Furthermore, the used car market for Chinese brands is expanding. The proportion of used Chinese car brands financed by the Bank increased from 20% in 2022 to 36% in July 2024. The growing popularity of used cars is evident across the market, with pre-owned cars accounting for 70% of Standard Bank VAF’s sales year-to-date compared to 62% in 2022.
De Vries says these brands are clearly gaining significant traction, reflecting the broader global trend where Chinese vehicles are taking more market share, driven by competitive pricing and growing consumer confidence.
"We are seeing a notable shift in the South African automotive market because of the popularity of Chinese car brands. We constantly see GWM brands in the top ten of Naamsa’s Vehicle Sales by Manufacturer list,” he concludes.