At the end of 2023 there were over 50 different brands of passenger car/utility available in Australia. And yet hardly a week goes by without an announcement trumpeting the imminent arrival of another brand to our shores. Almost all the newcomers are of Chinese origin.
So, as the average new car purchaser surveys the landscape and tries to make a measured decision on what to buy, it’s getting more and more difficult to know which brands will survive the rigours of this increasingly competitive market and which ones will drop by the wayside. The consequences of buying a new car that later becomes an ‘orphan’ here can be considerable. Make the wrong choice, and consumers can, and often will, regret it in years to come.
Living with an ‘abandoned marque’ can mean reduced interest from the motor trade in carrying out warranty work, servicing and also increasingly difficult parts supply. It’s also likely that steeper depreciation will reflect these challenges and therefore add to the overall cost of ownership.
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Furthermore, bear in mind that it’s one thing for a company like General Motors to pull brands out of this market (Holden and Opel, for example), but quite another for some recent start up Chinese make to do the same.
Think about it. If the worst comes to the worst, it’s always possible to source parts from the US or Europe directly if need be for an Opel, for instance. A pain in the neck, for sure, but possible. And the sheer volume of Aussie-built Holdens means that parts will be around for a long time to come. However, what’s likely to happen when one of the newer Chinese brands heads for the hills? Good luck trying to go online and find what you need for your GBH Tantrum 450. As for honouring seven year warranties… that’s proving hard enough for some recently arrived brands who are very much alive and here! No names yet, but at some point the proverbial is going to hit the fan over current antics, let alone if a brand is no longer on sale in Australia at some point.
There’s simply no doubt that not all these new Chinese brands can survive here. There isn’t room for all of them. And some will also die at home, where the market is also starting to sense real casualties on the horizon.
But it’s not only in the Chinese sector that there will be casualties.
I’ll give you some examples from other markets where very well established names have pulled out completely and no longer sell new cars there in order to underline the point that this is a very real threat for a new car buyer of even better known brands.
In 2021, Mitsubishi pulled out of the UK market. That would have been unthinkable at one point. The Shogun (the Pajero in many markets) was the darling of the towing brigade and the Lancer Evo range was everyone’s dream alternative to the Subaru Impreza. But times changed. As they did over a decade ago in the USA when Suzuki abandoned the car market there.
Here in Australia, as it’s increasingly evident that the new car market is under pricing pressures (evidenced by recent down gradings in profit forecasts by major car retailers, despite sales records), there are well known brands that simply won’t stay around forever. Some have only lasted this long because it was possible to sell almost anything and everything in the COVID era.
In this ‘New Normal’ environment, reality is hitting home now that supplies of new vehicles are no longer an issue and, predictably, manufacturers in far off lands are back to their old ways of flooding markets with cars almost regardless of genuine demand.
So, any mainstream brand that’s selling less than around a thousand cars a year here is one that I, personally, would avoid. I’m not talking about the luxury or sporting brands such as Bentley or McLaren of course. I’m talking about the likes of Fiat, Citroen and Jaguar.
Surely it no longer stacks up for these brands to stock cars, to stock parts, to provide service backup into this market? I love the history of Citroen, for instance, but the latest range is of zero interest to me and I’m not alone, judging by the fact that only 228 new Citroens were registered in Australia in 2023.
I do wonder just how long any of the Stellantis brands will remain in Australia (RAM apart), given the dramatic drop in sales of even the Jeep range here over the last decade. Ok, they still sold over 4,000 units in 2023, but 10 years ago that figure was over 22,000.
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And will Jaguar survive anywhere at all in a decade? They’ll have to dramatically reinvent themselves within a year or two if they’re to have any chance. Unfortunately, they appear to have well and truly pinned their colours to the EV mast just at a time when it’s increasingly clear that most manufacturers will need to have both ICE and EV products in their respective ranges for years to come.
For me, there’s never been a time like this when an astute consumer, at least here in Australia, would do well to stick with the tried and tested, well established, brands that are on the market today. The flight to quality will come as buyers see through the special offers and ever cheaper finance deals. When the music stops, there simply won’t be enough chairs for every brand that’s here already, let alone those who have yet to arrive.
And then, there’s the flip side! An orphan car can make a great deal of sense as a second hand buy down the line. I bought a Saab some years after the brand not only pulled out of Australia, but went belly up completely. I still have it, as I’ve detailed on these pages previously. But I’m very glad that I didn’t buy it new! And that’s the point. I paid a fraction of what it cost new, despite it having hardly been used. My eyes were open.
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