There has to be brands that don't survive: Chery not afraid of increased competition from Chinese rivals in 2025 but warns not all will make it

Speaking to CarsGuide at the launch of its new Tiggo 8 Pro, Chery’s Australian Managing Director Lucas Harris said the brand was not afraid of the onslaught of new Chinese automakers confirming their arrival in Australia on or before 2025.

“Let them come” he said. “More choice for consumers can only be a good thing - giving consumers good value products, different technology, and more options, it’s all great.”

“As to what sets us apart? Well, it’s not easy to get started in Australia. It’s not just the regulatory aspect. Importing the cars and getting them on the dirt is one thing, but figuring out how to actually get them into customer hands is another altogether.”

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“Looking at dealer real estate - there are not a lot of empty showrooms around and it’s hellishly expensive to build one. It’s also a big job to give those dealers confidence to establish showrooms for a new brand.”

“We have a long-term commitment to Australian customers. We’ve already got an established dealer network - we’re in every major metro, regional and rural - and that’s not just to sell cars, but to support customers too. We put our money where our mouth is when it comes to parts supply. Everything from a small fender bender to more major parts, we’ve got them. Invariably, if something goes wrong, we can get them back on the road quickly.”

The coming storm of new Chinese rivals both Chery and legacy automakers will face in the coming years includes GAC, Geely, Xpeng, Leapmotor, Skywell, and Zeekr, and that’s not counting new and updated models from the existing (and successful) players like GWM, MG, and BYD.

“We’re serious - it’s not just about coming here to sell a few cars. We want to be here for the long term. Customers will say talk is cheap but what are you going to do to support me.”

Chery’s primary rivals will be MG and GWM as well as the incoming GAC and Geely.

When asked if some brand’s won’t make it in Australia, Harris said “There has to be.”

“The market isn’t going to grow overnight. It’s going to get more competitive and there are going to be headwinds for some brands with the new energy standards coming through (NVES). I think we’re going to see a shift in who makes up what parts of the market. Some brands [in trouble] may be new, some may be legacy. It’s exciting I think. How good for consumers?”

Harris isn’t alone in this train of thought. Speaking to CarsGuide just in the last few weeks, senior figures from both Kia and Xpeng’s importer provided quotes along the same lines - there will be brands which won’t be able to survive in Australia.

When asked, Harris was confident that price won’t be Chery’s only unique selling point as it strives to stand out in the coming years, and the brand’s pricing model would have to be at least somewhat sustainable going forward.

Next for Chery before the end of 2024 will be its first EV - the Omoda E5.

“I don’t know if our pricing is particularly cheap, I just think it’s good value for money.” he said, “The benefits we have around the lean production process - to merge those [construction steps] and highly roboticize the factory - all of those things help to reduce costs.”

When queried on the quality derived from these new manufacturing processes, Harris said Australians will also need to shed their preconceptions about the quality of vehicles from Chna.

“The reality is we have to be [quality] - most developed countries have fairly hard design rule requirements. To bring cars to this market you have to meet the standard. This notion of quality being linked to country of origin - I don’t think that’s a good measure.”

Next for Chery before the end of 2024 will be its first EV - the Omoda E5 targeting rivals like the MG ZS EV, Hyundai Kona EV, and the BYD Atto 3, as well as its most affordable model, the Tiggo 4 small combustion SUV, which will be targeting the entry-level SUV segment and rivals like the Hyundai Venue, Kia Stonic, and MG ZS.

The most affordable model, the Tiggo 4, a small combustion SUV.

From there, the brand will launch its Jaecoo sub-brand of semi-premium mid-size SUVs to sit above the current Tiggo 7 and Tiggo 8, and hasn’t ruled out introducing the Tiggo 9 large SUV revealed at the Beijing motor show. It is also aiming to introduce plug-in hybrid versions of its existing range in the future.

With its mainstream range of primarily combustion and incoming hybrid models, Chery’s primary rivals will be MG and GWM as well as the incoming GAC and Geely which will also be offering combustion and hybrid models as opposed to new EV-only plays like Xpeng nad Skywell, or the PHEV and EV-focused BYD.

“We’ve focused on wanting to offer customers powertrain agnostic options” Harris explained, “If they want ICE, if they want plug-in, or if they want EVs - we can offer it.”