BusinessTech
Chinese vehicles have become hugely popular among South African motorists in 2022, offering luxury cars at affordable prices that are now built to last.
This is even though cars made by Chinese brands have historically been labelled as unreliable vehicles that wouldn’t last as long as their European and Japanese counterparts.
When Chinese brands first entered the South African market, like Chery in 2008, they failed to gain popularity due to the automakers’ main goal of producing really cheap cars instead of high-quality ones. This led to a bad reputation among car enthusiasts, especially when one considers their safety ratings – with most receiving very low scores or none at all.
However, this trend is fast becoming a thing of the past as Chinese brands seem to be pulling ahead in the South African car market. Over the years, the demand for notable Chinese brands such as Chery and Haval – and by extension GWM – has increased significantly.
According to the National Association of Automobile Manufacturers of South Africa (Naamsa), in 2019, Haval had only sold 872 cars, while Chery wasn’t even on the radar.
Fast-forward to 2022, Chinese cars are now outselling many traditional and trusted brands such as Ford, Kia, Honda, and even BMW and Mercedes-Benz.
Naamsa’s new vehicle sales report for October 2022 shows that Chery sold 1,229 units and Haval sold 2,602 units. Whereas BMW sold 946 units and Mercedes-Benz sold only 737 units.
Additionally, these numbers show a stark increase in Haval’s sales since 2019, representing a 198% increase, while Chery’s sales are likely to be in the same region.
This significant increase in demand for these vehicles has led to both Chery and Haval being listed in Naamsa’s top 15 vehicle manufacturers in South Africa based on total sales in October 2022, which is given in the table below.
These sales numbers for Chery and Haval are mostly thanks to their medium SUV introductions, the Chery Tiggo Pro 4 and the Haval H6 – which sold 695 and 956 units, respectively.
Chinese brands still have quite a way to go to catch up with mid-range offerings from long-time favourites Toyota and Volkswagen (VW), which sold 12,574 and 4,904 units, respectively, in October 2022.
However, the principal analyst for Europe, the Middle East and Africa at S&P Global Automotive, Walt Madeira, says that the Chinese have identified a healthy SUV niche in the South African market – which is growing in demand.
“South Africans have always required robust vehicles such as pickups and off-road SUVs to tackle the demanding landscape, and I believe that the key to this success [of Chinese brands] has been launching high-quality SUVs with a very competitive pricing strategy at the best time,” Madeira.
This is unsurprising, as the national sales manager of Chery South Africa, Jay Botes, said that many South Africans are strapped for cash, given the high cost of living due to inflationary pressures – and Chinese brands offer good value for money in 2022.
The price of a Haval H6 ranges from R479,950 to R669,950, while the Chery Tiggo pro 4 ranges from R299,900 to R399,000.
In contrast, the cheapest Mercedes-Benz and BMW on the market are their hatchbacks, with a starting price of R696,509 and R625,072, respectively – with prices moving into the millions for their SUV offerings.
Considering these price differences, there’s not much more a Mercedes-Benz or BMW can offer prospective buyers that a Haval or Chery can’t with their respective best-selling models – especially when considering what you get for the price. For example, Haval’s top-of-the-range H6 is a hybrid model that offers everything an entry-level German car can and more.
Additionally, both the H6 and Tiggo Pro 4 have five-star safety ratings, which is on par with the luxury brands.
More interestingly, the Chery Tiggo Pro 4 comes with a 10-year or 1-million-kilometre engine warranty – which is unheard of and clearly shows that the automaker is confident that its vehicle will last a very long time.
Both Chery and Haval have noted that there have been dramatic improvements in the quality of their cars – with Botes saying that Chery had “reinvented itself as a technology and design leader and the benchmark for customer service”.
The sales figures of Chery and Haval in 2022 represent these brands’ acceptance by South African car buyers, and both Botes and Madeira agree that the Chinese brands’ big play of striking an effective balance between quality, safety and price will continue to win over South African customers.
Read: The used-car bubble in South Africa could be about to burst
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