Global leaders for three of the world’s top car companies touched down in Australia in the same week China broke through to become the nation’s number one supplier of new vehicles.
China vaulted past Japan and Thailand to become the top source of cars for Australia in February, according to sales data released by the car industry in March.
Officially, chief executives for Audi, Ford and General Motors landed to watch their new Formula 1 teams tackle the Australian Grand Prix.
But the champagne of racing could be followed by a throbbing hangover from emerging brands looking to conquer Australia, and beyond.
Ford chief executive Jim Farley took a road trip through Queensland before visiting the track, test-driving Chinese rivals to the Ford Ranger that are not available in the US.
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“Australia is the place where CEOs need to spend time, because you
have virtually no tariffs, so it’s a complete open market. Anyone can import their vehicles and sell them here,” Mr Farley said.
“So you see competition here (Australia) that you don’t see anywhere else in the world.”
Audi chief executive Gernot Döllner stopped by after discussing the threat of new rivals with local dealers.
BYD’s Denza, MG’s IM and Chery’s Lepas bring a premium spin on the discounted models people have come to expect from Chinese companies.
“We’re taking the Chinese competition very seriously,” he said.
“We definitely have to work on our price position and on efficiencies and development.
“We are not scared … but it’s true competition.”
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Mr Döllner said brands such as Chery and MG were “very strong in Great Britain”, and had plans for further expansion throughout Europe, noting that “the competition is growing worldwide”.
General Motors’ Australian arm cancelled planned media interviews with chief executive Mary Barra so that she could focus on the first race for Cadillac’s F1 team.
The Chinese threat to Cadillac’s struggling Australian arm would not be lost on Ms Barra, who has previously described the industry led by BYD and GWM as “a race to the bottom” that represents bad news for established brands.
Ford’s Farley said Australia “has become ground zero for the global industry”, describing the local market as “a cauldron of innovation and brutal competition”.
The Ford boss test-drove rival utes such as the BYD Shark 6 and GWM Cannon Alpha, praising them as “very competitive” machines.
And there are more on the way, with companies such as Chery, LDV, JAC and MG preparing new utes for Australia.
“The competitive landscape has completely changed now in the last three or four years, globally,” Mr Farley said.
“And body-on-frame medium pick-up trucks are a global profit pool that every Chinese company is looking at.”
Audi isn’t worried about the ute market.
But it is playing catch-up with compact electric cars built in China by brands including Tesla, BMW and Volvo, as well as an electric roadster by MG that is years ahead of a planned battery-powered successor to the Audi TT.
“It will be a true sports car, definitely not for the racetrack, but for sporty driving on country roads, it’s the perfect car,” Döllner said.
“We have some pretty cool ideas in the Audi way to bring emotion to cars with an electric drivetrain.”
