Finance Association, March 6 (Editor: Xiaoxiang) Chinese NEV companies, led by BYD, are now setting their sights on Australia.

While demand in the electric vehicle market in major developed economies such as Europe and the US is declining, Australia's electric vehicle market is still hot — generous subsidies and tax incentives from the Australian government, as well as high gasoline prices, are driving a continuous surge in local electric vehicle sales. However, for Chinese car companies that have gone overseas in large numbers, what is particularly rare right now is that in such a developed market, they have not faced any suppression by trade barriers so far.

Since coming to power in 2022, Australia's current administration, led by Prime Minister Anthony Albanese (Anthony Albanese), has been actively promoting the development of the electric vehicle market as part of the national emissions reduction plan — a key change in the country's relevant climate policy. Over the past decade, Australia's former government, led by conservatives, has been accused of not acting well on climate change issues.

This has strongly warmed the demand for electric vehicles in the Australian market. According to data from the Australian Federation of Automobile Manufacturers, in 2023, electric vehicles already accounted for 7.2% of new vehicle sales in Australia, far higher than 3.1% the previous year.

Behind this, Chinese new energy vehicle companies, led by BYD, are gradually developing into a force that cannot be ignored more and more in the region!

Chinese car companies are “blooming” in the Australian market

Many people in the local industry said that although Tesla is also benefiting greatly from the electric vehicle boom in Australia, for traditional car manufacturers such as Toyota and Ford, the biggest threat to the Australian market are Chinese NEV companies that are mainly located in non-high-end markets.

According to statistics from the Australian Federal Association of Automobile Manufacturers, Chinese electric vehicle giant BYD sold more than 12,000 vehicles in the Australian market last year. BYD accounted for 14% of the Australian electric vehicle market that year, ranking second highest, behind Tesla's 53%.

However, BYD's sharp rise in sales in the Australian market continued unabated in the first two months of this year. According to data from the Australian Federation of Automobile Manufacturers, in January of this year, BYD surpassed Tesla (1107 units) in sales of electric vehicles in the Australian market (1,310 units) for the first time.

Although the ranking change in that month was mainly due to Tesla facing backseat belt issues and delays in delivery in the local market, the steady performance of BYD's sales can already be seen. Meanwhile, the latest data released on Tuesday further showed that BYD's sales volume in the Australian market in February further increased to 1,549 vehicles, another increase of 101.2% over the same period last year.

David Smitherman, CEO of EVDirect, BYD's distributor in Australia, said, “The current opportunities are very clear. We need to enter the mainstream market now.”

According to Smitherman, BYD will add two SUVs and a pickup truck to the Australian market this year, bringing its product matrix in Australia to six. evDirect will also open 30 more dealerships within the next 18 months, bringing the total to 55, and has begun mass sales to companies such as Uber.

SAIC Motor will also launch three new models in Australia under its MG (MG) brand this year, including the MG3 hybrid model and the MG Cyberstar electric convertible sports car, bringing its lineup of electric/hybrid vehicles in Australia to five.

The Chinese startup Zero Sports Auto announced a partnership with Stellantis to expand the global market in the fourth quarter of last year. The company has already listed Australia as a priority market.

Is the Australian market becoming a “sweet bastard”?

Although Australia sold only 1.2 million cars last year, it is actually a relatively small market on a global scale. However, since Australia has no local automobile manufacturing industry, and it is generally thought that it is unlikely to introduce protectionist trade barriers, it is extremely attractive to Chinese NEV companies that are now eager to go overseas and create a world of new energy vehicles.

To stimulate demand for electric vehicles, the Australian Government has previously exempted some consumers from taxes through electric car leasing/purchase agreements signed by their employers.

The three most populous Australian cities, Sydney, Melbourne, and Brisbane, have also set targets for electric vehicles to account for 50% of total new car sales by 2030, providing generous tax rebates to buy electric vehicles, and are investing heavily in the construction of charging stations.

According to Mark Adamson, a 61-year-old resident of Queensland, Australia, these incentives were a key reason he chose to buy a BYD electric car. The retail price of the BYD Atto 3 long-range SUV (corresponding to domestic yuan plus) he bought was 54,000 Australian dollars (about 253,000 yuan). Through the state government's tax refund policy, he received a discount of 6,000 Australian dollars (about 28,000 yuan), and then BYD offered a discount of about 2,000 Australian dollars (about 9,400 yuan).

“I thought why not try it? It's really worth a try, and I have extra solar power at home, so I mostly charge it at home. “In many ways, it was a no-brainer,” he said.

In fact, in Queensland, the state government's tax refund alone means that the price of the Atto 3 is even lower than the Toyota RAV4 crossover (similar model).

For Peter Alley, a 63-year-old trade union organizer in Sydney, he drives out once a week to visit his family who lives 370 kilometers away. It was precisely because he needed to save on local gasoline costs, which are currently close to the highest point in history, that he switched from a 2008 Volkswagen diesel van to an Atto 3.

He said that his weekly charging costs are now around 20 Australian dollars, while in the past the weekly fuel costs were as high as 130 Australian dollars.

According to PricewaterhouseCoopers, half of new car sales in Australia will be electric cars by 2027. However, given that the popularity of NEVs in the Australian market is still far from being compared to markets such as China, the European Union, or even Southeast Asia, this has undoubtedly become a new blue ocean full of opportunities for Chinese NEV companies.