Not all Chinese brands will survive in Australia but we will, says Leapmotor boss

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Leapmotor’s Australian head Andy Hoang believes there will be casualties in the fight for the hearts of local car buyers.

“This is my personal belief. I don’t think all Chinese brands will survive … the volume is just not there,” he said.

Many industry observers hold the same view and warn that buyers who pick a brand that fails could be left to endure sub-par service, parts and warranty coverage, along with poor resale values.

At first glance, Leapmotor would appear to be one of the more vulnerable of the Chinese brands. 

It is one of the few Chinese carmakers not enjoying spectacular growth in the local market.

While brands such as BYD, Chery, GWM and MG have stormed into the top ten, Leapmotor sales have been modest since it launched in November 2024.

The brand has found just 1168 buyers this year, up from 452 last year. For context, BYD sold more than 8000 cars last year.

But Hoang believes Leapmotor can replicate its success in Europe and China, where it has grown rapidly in seven years to be one of China’s biggest brands, particularly in the EV and plug-in hybrid space.

“We’ve got one of the fastest brands growing in China. We’re one of the fastest brands growing in Europe. So we know that from the product standpoint, the product stacks up,” he said.

Leapmotor sold a little more than 1000 vehicles globally in 2019 but is on track to sell 1 million this year.

Hoang says the brand is focused on growing its local product line-up, network and awareness, rather than chasing sales for the sake of them.

“If you look at those three things, if those are the core foundations of building a sustainable business, then yes, we’ve grown,” he said.

The line-up will double from two to four models by the end of this year, with the addition of the BO5 hatch and the BO3X compact SUV, and Hoang expects growth will follow.

“We are growing, but would we like to grow faster and more? Of course. But it has to be sustainable. Our investment here in Australia is for the long term. So it’s not just about sales now. It’s about trying to build that business.”

He said that growing too quickly had the potential to create problems.

“Everyone has to run their own race. I think there is a danger, though, if you don’t have the foundations in place.

“It’s not just about selling cars. It’s actually about that whole life cycle journey,” he said.

That included the dealer network, parts availability and the level of technical support available.

Anecdotal reports suggest that some Chinese brands are struggling to source parts for warranty claims and accident damage, resulting in long periods off the road for customer cars. 

Hoang said the cut-throat competition presented other pitfalls for buyers, including heavy discounting that eroded resale values.

“Every time you take a price cut, you’re killing the residual of all the customers that have already been loyal to you. Particularly those ones that you know who have made the choice to go with your brand before knowing who you really are, and they’re the last ones that you want to actually penalise,” he said.

At its 2024 launch, Leapmotor committed to launching six vehicles in three years and Hoang remains committed to that and more. He believes there’s an opportunity for a seven-seat SUV and a sporty version of the BO5 hatch.

“That sort of sports hatch segment. We think that’s definitely another opportunity because there’ll be a halo sort of effect on the rest of the brand having that.

“We know there’s a ute segment out there that we’ve been talking to China about,” he said.

The brand has also been building its dealer network, expanding from 16 to 25 outlets over the past 12 months.

“I think longer term for us, the next goal will be to get between 35 and 40 outlets with all models. We believe that that’s probably a good balance between expanding quickly and at the same time making sure that wherever you open your sales and service, that customer experience is ensured.

“We know that if we get the right product line up here, the sales and customers will come.”