Toyota has identified old-fashioned customer service and a solid dealer network as the key assets for car manufacturers in their quest for a strong position in the Australian car market.
Australia’s already saturated new vehicle market will enter uncharted territory in 2025, when at least half a dozen more highly ambitious Chinese brands will enter the fray, bringing to more than 65 the number of players fighting for what is expected to be a smaller pie will be and will force even greater fragmentation of the local automotive landscape.
On a global scale, China’s auto industry has already proven to be a huge disruptor to the overall auto market, stealing chunks of volume from established brands and pushing companies like Volkswagen and Nissan against the financial ropes.
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But in the wake of a record local car market in 2024, with Toyota leading the way for the 22i.e With a huge 19.5 per cent share, Toyota Australia sales chief Sean Hanley says he believes customer service and dealer networks will remain key strengths of established car brands.
“I don’t want to comment specifically on other brands, but I hope we don’t see more exit because no one gets any pleasure from that. One of the most difficult times in automotive history was when Holden withdrew from Australia,” said Hanley.
“But it is difficult to imagine how brands with more than 60 brands can survive in a market of 1.2 million sales – and that will rise as the year progresses. You just have to do your math.
“I can’t imagine how all those brands will survive, and how they can serve customers and parts and invest in the franchises to provide the service Australians need across a huge area.
“Australia is quite unique in some ways. In my thinking we tend to talk about products or cars, which is important. However, I think brands that serve their customers best are the ones that will survive in Australia.
“So you would have to think that it is the established brands that remain strong with their well-invested networks.”
Mr Hanley’s sentiments echo similar comments from the country’s main car retail body, the Australian Automotive Dealer Association (AADA), which previously predicted there would be more brand casualties in the coming months.
The list of legacy car brands that have left the Australian market in recent years is growing, with the most recent highlight being the departure of French brand Citroen.
Conversely, most brands entering the Australian market are from China, including Deepal, Leapmotor, Xpeng and Zeekr in late 2024.
They will be followed in 2025 by Geely, Skywell, GAC/Aion and Chery spin-off brand Jaecoo, while Foton will also resume selling utes in Australia next year under new distributor Inchcape. Another option is Nio.
“It will be interesting to see where it all goes,” Hanley said. “But when I look at the math, I find it very difficult that all these car companies can be healthy, wealthy customers and serve customers the way customers in Australia expect in the future.
“For Toyota, we will continue to focus on quality sales and doing what we do best: providing customers with the best experience. In the end, that is still the most important thing.”
