China’s new energy vehicle giant BYD and other electric vehicle players have set their eyes on Australia for their business expansion plans.
It is indeed a good strategy, considering that Australia is a friendlier market for Chinese electric automakers compared to the US and Europe.
Australia’s supportive policies attract Chinese EV players
Unlike the US and European markets, Australia currently has no anti-Chinese policies.
Chinese electric vehicle players have not yet struggled with trade barriers in the country. Moreover, their sales significantly increased due to the Australian government’s supportive subsidies, tax incentives, and surging gasoline prices.
Prime Minister Anthony Albanese’s government has significantly pushed for electric vehicle uptake since assuming the position in 2022, seeking to reduce the transportation sector’s carbon emissions.
In effect, it substantially boosted electric vehicle sales in the country, hitting a 7.2% share in new car sales last year (up 3.1% YoY).
Although America’s Tesla is also taking advantage of Australia’s enticing offers, Chinese electric automakers in the mass-market segment remain the biggest threat to previous leaders like Toyota and Ford.
Situation in the US and European market
The US government currently offers a tax credit of up to $7,500 for eligible electric vehicle models under the Inflation Reduction Act of 2022.
However, it indicates stringent requirements to ensure the growth of the country’s manufacturing industry.
These changes are part of the US government’s efforts to boost its electric vehicle uptake and cut its heavy reliance on China.
Meanwhile, the European Union initiated a probe against Chinese electric automakers’ extremely cheap electric vehicle offerings late last year. It is crucial for the EU’s strategy to protect the competitiveness of local brands as the “global market is flooded with cheaper electric vehicles the price of which is kept artificially low owing to huge state subsidies.”
BYD’s presence in Australia
BYD enjoyed an almost sixfold sales increase to more than 12,000 units in Australia last year despite only penetrating the local market in 2022.
It currently holds 14% of the country’s electric vehicle market, trailing behind American giant Tesla with 53% market share, according to the Federal Chamber of Automotive Industries.
“The opportunity is very clear. We need to now get into the mainstream market because we’ve sold to the early adopters and the passionate EV purchasers.”
David Smitherman, EVDirect CEO, BYD’s distributor in Australia
All that said, BYD plans to introduce two SUVs and a pickup truck to join its Australian product portfolio, the EVDirect CEO said. It will launch the updated 2024 Atto 3 in the local market “in the coming months.” Considering the strong dominance of the all-electric Model Y crossover, it would be interesting to see how BYD would beat Tesla in the Australian market.
