South Africa’s automotive retail sector has entered a new phase of consolidation as dealerships race to secure a foothold with fast-growing Chinese and Indian brands.
What began as a shift in consumer buying patterns is now reshaping the industry’s structure, resulting in a wave of mergers, acquisitions and targeted investments. Major retail groups are increasingly prioritising early acquisition, rapid scaling and alignment with brands gaining traction among price-sensitive consumers.
The rise of Chinese and Indian carmakers has been one of the significant shifts in South Africa’s car market in recent years. By early 2026, vehicles from these markets accounted for nearly half of new vehicle sales at some large dealership groups, reflecting how rapidly consumer preferences have evolved.
Affordability, improved quality and high specification levels are driving demand, as households navigate a constrained economic environment. This has accelerated a broader “buying-down” trend, with consumers opting for value-driven alternatives over traditional premium brands.
The impact has been material. Established marques such as Ford, Nissan and Volkswagen are facing mounting pressure as competitors from China and India undercut them on price while matching — and in some cases exceeding — their feature offerings.
For dealership groups, this is not just about product mix; it is about survival and growth in a changing market.
As these brands gain traction, dealership groups are moving beyond simply adding them to their portfolios. Instead, they are acquiring dealerships that already represent them, accelerating their exposure to high-growth segments.
A recent example is the competition tribunal’s approval of Supergroup Dealerships’ acquisition of an Mbombela-based dealership operating under the Chery, Omoda and Jaecoo brands. The deal gives Supergroup full control of the business and strengthens its presence in a segment that is expanding rapidly.
The group already operates across multiple brands and segments, including passenger vehicles, commercial vehicles, parts and aftermarket services. The addition of another Chinese brand-linked dealership reflects a broader strategy of building scale in areas of rising demand.
This type of transaction is becoming increasingly common. Smaller, independent dealerships, many of which were early adopters of Chinese and Indian brands, are now attractive acquisition targets for larger groups looking to consolidate their position.
Major dealership groups are also reshaping their portfolios more broadly, increasing their exposure to brands from China and India.
Combined Motor Holdings (CMH), which operates more than 100 dealerships, has previously indicated that almost half of its new vehicle sales now come from these brands. The shift has helped drive a significant increase in profitability, highlighting the commercial upside of aligning with high-growth segments.
Similarly, Motus, the country’s largest non-manufacturing automotive group with more than 300 dealerships, also acknowledged that it was initially slow to introduce Chinese brands, even as their popularity surged, Business Day reported.
That stance is now changing. This week, Motus opened a new dedicated dealership for Indian carmaker Mahindra in Tyger Valley, marking a further step in expanding its presence in high-growth segments.
“Strategically, this marks our first step in building a meaningful partnership with Mahindra,” said Motus Retail Western Cape franchise executive Riaan Janse van Rensburg.
“We are aligning our portfolio to reflect where the market is moving, strengthening our OEM relationships and positioning Motus Retail as the partner of choice for high-growth brands.”
The growing influence of Asian brands is also driving deeper structural changes, extending beyond retail into manufacturing and long-term investment.
Chinese carmaker Chery also recently acquired a production plant in Rosslyn, Pretoria, with plans to begin local manufacturing — including electrified vehicles — by 2027.
Last year, Mahindra conducted a feasibility study to upgrade its Durban facility from semi-knocked-down (SKD) assembly to full completely knocked-down production, signalling a potential move toward deeper localisation.
Government policy is reinforcing this direction. Trade, industry & competition minister Parks Tau has previously indicated that foreign carmakers operating SKD plants have committed to upgrading to full manufacturing capacity in an effort to strengthen domestic production and reduce reliance on imports.
The pace of change is being amplified by the rapid entry and expansion of new brands.
More than 15 Chinese carmakers are now active in South Africa, collectively capturing a growing share of the market. By the end of 2025, Chinese brands alone accounted for more than 17% of new vehicle sales, up sharply from just a few years earlier, Business Day reported.
New entrants such as state-owned Chinese carmaker Changan are also scaling aggressively, expanding dealership networks and broadening their product ranges within a short period of entering the market.
This influx is transforming competitive dynamics. What were once considered budget alternatives are now mainstream contenders, competing across multiple segments and price points.
Chinese and Indian brands are no longer peripheral players; they are central to growth, profitability and strategic planning. Their rise is not only changing what consumers buy but also how dealership groups structure their businesses and deploy capital. The result is a dealership landscape defined by consolidation, competition and rapid repositioning.
As more deals are concluded and investment accelerates, the industry is likely to see further integration between retail networks and the brands driving demand. In this environment, dealership groups are not just selling cars; they are now competing for relevance in a market being reshaped in real time.
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