China has officially surpassed Japan to become the largest source of imported vehicles for the first time, marking a significant pivot in the Australian automotive market.
According to data from the Federal Chamber of Automotive Industries (FCAI) quoted by Caixin, the shift occurred in February, when vehicles imported from China reached 22,300 units, capturing an estimated 25% of the import market share. This pushed China ahead of Japan, which recorded 21,600 imports, and Thailand, which recorded 19,400 units.
The February data marks a turning point in the dominance Japan has held over the Australian automotive import market since 1998. The shift indicates a rapid change in consumer preferences toward electric vehicles and cost-effective alternatives provided by Chinese automakers.
The rise of Chinese imports can be largely attributed to the surging popularity of EV and plug-in hybrid (PHEV) vehicles. Among the top performers is BYD, which has capitalised on Australia’s rising demand for affordable electric vehicles. BYD’s sales increased by 160% to 10,200 units in the first two months of the year. Great Wall Motor (GWM) has also seen success in the SUV and ute (pickup) segments. GWM reported a sales increase of 23.4% in 2025, making it a market leader in its categories.
Australia’s passenger vehicle market is heavily dependent on imports, lacking a domestic manufacturing base since the exit of major automakers’ local manufacturing. The absence of tariffs on imported vehicles and a diverse consumer preference for SUVs and light commercial vehicles make Australia a key market for expanding global automotive brands. Australian consumers have accepted Chinese vehicles rapidly due to competitive pricing, advanced technology features, and the shift toward electrification.
In just a few years, Chinese automakers have become integral to the Australian market. Since 2020, a total of nine new Chinese brands have entered the Australian market, bringing the total number of Chinese automakers in Australia to over a dozen. Among the dominant brands are MG, BYD, Great Wall Motor (GWM), and Chery.
EV sales alone in Australia rose to 103 thousand units across major markets last year, with Chinese-manufactured cars having a significant share in the Australian EV sector.
Industry analysts quoted by Caixin predict that Chinese carmakers could dominate over 40% of the Australian new vehicle market by 2030, if their aggressive pricing and technology trends hold.
