Chinese automotive brands have continued to grow in South Africa since the start of the year and now make up nearly 20% of all passenger car and light commercial vehicle (LCV) sales.
This is according to TransUnion’s Q1 2026 Mobility Insights Report, which highlights that the passenger vehicle market has remained resilient despite shifts in demand.
TransUnion credited rising affordability pressures, including higher fuel costs, the growth of Chinese brands, and shifting powertrain preferences, for reshaping the local automotive landscape.
The latest quarterly Mobility Insights Report shows that passenger vehicle sales reached 114,517 units in the first three months of 2026, which represents a year-on-year (YoY) growth of 12.6%.
It noted that South Africa entered 2026 on a stronger economic footing, supported by easing inflation, lower interest rates over the previous year, reduced load-shedding, and improved overall financial conditions.
However, since then, rising geopolitical tensions in the Middle East have led to a global oil price shock, resulting in skyrocketing petrol and diesel prices and heightened downside risk.
“Vehicle demand has not collapsed, but the market is moving into a more selective phase,” said Ayesha Hatea, director of research and consulting at TransUnion South Africa.
“Consumers are still buying vehicles, but affordability is no longer only about the purchase price. Fuel costs, financing costs, insurance, servicing, and total cost of ownership are becoming central to the decision.”
Instead, the report found that residual values are becoming an increasingly important consideration in vehicle affordability.
TransUnion explains that as finance terms extend past six years for many buyers, depreciation and resale value are playing a growing role in ownership economics, giving brands that retain value a competitive advantage.
Chinese brands are reshaping the competitive landscape
The Mobility Insights Report highlighted the continued rise of Chinese automotive brands, which saw sales grow by 75% YoY in the first quarter, significantly more than the traditional OEM growth of 2%.
As a result, Chinese badges accounted for more than 19% of new passenger and LCV sales nationally in the first quarter of 2026.
The Chery Group, which includes Chery, Jetour, Omoda, and Jaecoo, recorded combined sales of 16,094 units in Q1 2026, positioning it as a top-three manufacturer.
TransUnion noted that the shift towards Chinese offerings is no longer solely driven by entry-level pricing, with these brands increasingly competing on technology, features, fuel efficiency, range, warranty offerings, and perceived long-term value.
“Chinese brands have moved beyond the role of price disruptors,” explained Hatea.
“They are becoming structural industry players, influencing dealer networks, financing ecosystems, ownership perceptions, and the wider discussion around localisation and industrial competitiveness.”
The shift towards Chinese badges has also led to more South Africans considering their powertrain options.
TransUnion’s data showed that combustion engine vehicles remain the most popular choice, preferred by around half of all consumers in the first quarter.
That being said, interest in hybrid electric vehicles grew significantly to 39%, up from 30% in Q4 2025, making hybrids the leading electrified option.
It noted that interest in both battery electric vehicles (BEVs) and plug-in hybrids (PHEVs) also increased, with each reaching 26%.
“Hybrids are emerging as a practical transition pathway for South African consumers,” explained Hatea.
“They offer fuel savings and lower running costs without full dependence on charging infrastructure, which makes them relevant in a market where affordability and operating certainty remain critical.”
She added that the local automotive market is not reverting to its previous structure.
Domestic demand continues to support the industry, while vehicle exports remain under pressure amid trade uncertainty, geopolitical disruption, protectionism, and changing decarbonisation requirements.
“The next phase will be defined by affordability, value, access to finance and how effectively industry players respond to evolving consumer behaviour,” concluded Hatea.
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