Australia’s car market bursting with 67 brands

Australian car buyers have more choice than ever, but industry leaders warn that an influx of new brands and fierce discounting could push dealerships into financial trouble.

Car buyers in Australia are being spoiled for choice, with more than twice as many brands as the USA competing for attention in local showrooms.

The latest count puts the total at 67 brands, compared with just 30 in the USA, despite annual new-car sales in the States sitting at 16.3 million against just 1.24 million Down Under.

Comparisons with other major new-car markets tell a similar story, with 47 brands and 2.86 million sales in Germany, 40 brands and 2.02 million sales in the UK, and 36 brands competing for 1.9 million sales in Canada.

The figures come from the Australian Automotive Dealer Association (AADA), which is warning of oversupply and potentially serious economic consequences for the industry.

Despite the benefits to buyers of greater choice and lower prices, the AADA says the growing number of new arrivals from China is distorting the market and slashing profit margins for its member dealers.

“This is a clear warning that the commercial settings underpinning our industry are becoming unsustainable,” said AADA CEO James Voortman.

“There are simply too many manufacturers operating in this market and we need a pause on further car brands entering this market. At a time when other countries are trying to slow the rate of change and number of brands, Australia is allowing unfettered access to this market.”

Dealers warn of a looming crisis

The AADA is suggesting Australia needs some form of protection against the flood of new brands to prevent a looming economic disaster for dealerships.

The Victorian Automotive Chamber of Commerce (VACC) also believes the retail car business has reached a “crisis point” and is calling for urgent assistance to protect the long-term viability of the automotive sector.

It wants help from governments, carmakers and industry suppliers to combat what it describes as “deteriorating trading conditions”.

History is against the push for protection, however, as Australia has spent decades reducing barriers to imported vehicles, moving away from the days of a 57 per cent tariff and import quotas.

The Federal Government is also encouraging the uptake of electric vehicles through incentives.

“Australians benefit from choice and competition, but manufacturers’ growth ambitions must reflect what this market can support,” Voortman said.

“Pushing excessive stock onto dealers is fuelling a race to the bottom. Aggressive discounting erodes margins and devalues vehicles while dealers carry the financing costs and risk of unsold vehicles.”

Strong sales hide financial pressures

The AADA’s warning comes despite the latest VFACTS sales figures showing 103,325 new-vehicle deliveries in October, an increase of 3.8 per cent compared with the same month in 2025.

But the association says strong sales figures do not necessarily mean healthy businesses.

“Strong headline vehicle sales can conceal serious financial distress at the businesses making those sales. Dealers cannot keep absorbing higher costs, lower margins and greater stock risk indefinitely,” Voortman said.

“Competition safeguards matter, but their application must recognise the realities of an industry undergoing rapid structural change.”

For Australian motorists, the fierce competition means more models to consider and potentially better deals in showrooms. But for the dealerships selling them, the pressure is mounting.

Also check out Stand-by for the return of the Toyota Celica