Is the bubble going to burst for MG Australia? Why the pressure is on the MG ZS, MG HS and MG3 as the Chinese brand tries to continue its meteoric rise

Love ‘em or hate ‘em, you cannot deny the current MG range has been popular in Australia.

The Chinese brand finished the 2021 sales race in ninth position, placing it between the well-established Volkswagen and Subaru. What’s more, it did so with just three models, compared to Subaru’s six and Volkswagen’s 20.

MG sales totalled 39,025 in ‘21, a more than 155 per cent increase on 2020, with the ZS SUV the best-seller with more than 18,000 buyers found. That actually made it the best-selling small SUV, out-doing the likes of the Mitsubishi ASX, Mazda CX-30 and Hyundai Kona.

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The MG3 small hatch performed similarly, selling nearly 14,000 examples last year and claiming top spot in the ‘Light Car’ market, comfortably ahead of its nearest rival.

The brand’s larger SUV, the HS, struggled comparatively, selling 6828 examples in the very competitive ‘Medium SUV’ segment, where it does battle with the likes of the Toyota RAV4, Mitsubishi Outlander, Hyundai Tucson and Nissan X-Trail. 

But the question MG faces in 2022 is - how long can it keep up this level of success with so few models?

MG has no new models confirmed to arrive in 2022, instead its most likely next addition will be the MG5 small sedan. This will give the brand a rival to the likes of the Toyota Corolla, Kia Cerato and Hyundai i30 Sedan, which is right in MG’s demographic. However, it’s at least 12 months away, so what does the brand have planned to maintain its standing in the sales race?

According to a company spokesman, one major priority for 2022 will be ensuring that its growing customer base is well taken care of to try and ensure as many as possible keep spreading a positive message about the brand.

While it may sound like a simple idea, it’s something several brands have struggled with and it typically results in a sales crash as unhappy customers head for alternative brands. Jeep’s sales boom and slump after its multiple recalls of the Grand Chreokee is one prime example of such a scenario.

As part of this strategy, MG Australia has prioritised securing enough supply of ‘fast moving parts’ that will allow the brand to react quickly to any customer who has a small accident or needs maintenance, as waiting weeks - or even months amid the pandemic - for parts would upset owners.

While the model range won’t expand in ‘22, MG is trying to use giveaways to try and maintain buyer interest. In 2021, the company gave new buyers hand-sanitiser and is currently offering a bottle of wine to prospective owners, with more items planned throughout the year.

But gifts will only go so far in terms of luring customers, and there are some big questions about MG’s long-term future in Australia that could begin to be answered this year. Most importantly is the question of how far the brand can reach.

The trend for MG is obvious when you break down the sales by model, with the smaller, more affordable MG3 and ZS selling better than the bigger, more expensive HS - suggesting there may be a limit to how far the brand can push itself towards its more established rivals.

While brands including Hyundai and Kia have successfully transitioned from being value-led to quality, mainstream car companies, it took both decades. If MG can shortcut that process and introduce more polished offerings, as well as just more models in general, it could become a regular fixture in the top-selling brands.

But if MG cannot find more buyers looking for an affordable but simple new car, in the form of a MG3, ZS or HS, it could find its progress in Australia slowed until new models arrive in 2023 and beyond.