One of the most notable structural shifts in the South African automotive market is the continued rise of Chinese automotive brands – this according to TransUnion’s First Quarter (Q1) 2026 Mobility Insights Report.

Chinese car sales grew by 75% year-on-year in Q1 2026, significantly outpacing traditional brands’ growth of 2%, as well as broader passenger and light commercial vehicle (LCV) market growth of 12.7%.

As a result, Chinese brands accounted for more than 19% of new passenger and LCV sales nationally.

This means that nearly one in five new vehicles sold in South Africa was from a Chinese manufacturer in the first quarter of this year.

The shift is no longer driven solely by entry-level pricing, states the TransUnion report.

Chinese brands are increasingly competing on technology, features, fuel efficiency, range, warranty offerings and perceived long-term value.

On a combined portfolio basis, the Chery Group, which includes Chery, Jetour, Omoda and Jaecoo, recorded combined sales of 16 094 units in the first quarter, positioning itself as a top three automotive player.

“Chinese brands have moved beyond the role of price disruptors,” says TransUnion South Africa research and consulting director Ayesha Hatea.

“They are becoming structural industry players, influencing dealer networks, financing ecosystems, ownership perceptions and the wider discussion around localisation and industrial competitiveness.

According to the TransUnion Mobility Insights Report, new-passenger-vehicle sales reached 114 517 units in Q1 2026, slightly higher than the 114 246 units recorded in Q4 2025.

Year-on-year growth eased to 12.6%, down from the stronger performance seen during parts of last year, but demand remained elevated despite a more uncertain macroeconomic environment.

The report indicates that South Africa entered this year on a stronger economic footing.

This was supported by easing inflation, lower interest rates over the previous year, reduced loadshedding and improved financial conditions.

Rising geopolitical tensions in the Middle East and the associated oil price shock have, however, heightened downside risks.

Inflation increased from 3.1% in March to 4% in April, while the Reserve Bank’s Monetary Policy Committee raised the prime lending rate by 25 basis points in May.

Combined with higher fuel and transport costs, these factors are expected to place renewed pressure on affordability and consumer spending.

“Vehicle demand has not collapsed, but the market is moving into a more selective phase,” notes Hatea.

“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.”

The TransUnion report found that residual values are becoming an increasingly important component of vehicle affordability.

As finance terms extend beyond six years for many buyers, depreciation and resale performance play a growing role in ownership economics, effectively giving brands that retain value more a competitive advantage.

The shift towards longer financing terms and the use of balloon structures reflects a growing focus on monthly affordability and cash-flow flexibility.

This trend, however, also increases exposure to residual value risk.

Where vehicle values underperform expectations, consumers may face refinancing pressure or negative equity at trade-in, making used-vehicle market performance an increasingly critical consideration when buying a new vehicle.

Used vs New
The new- and used-vehicle markets continued to show differing trends.

TransUnion notes that new-vehicle registrations increased by 11.6% year-on-year in Q1, marking a sixth consecutive quarter of double-digit growth.

In contrast, used-vehicle registrations increased by a more modest 2.6%, suggesting a modest recovery in the secondary market, although it still trails the stronger momentum seen in new-vehicle sales.

While used vehicles still make up the majority of total registrations at 69%, the share of new vehicles has risen to 31%, up from 23% at the end of last year.

This shift has been supported by favourable pricing dynamics, with new-vehicle inflation falling to 0.8%, while used-vehicle prices remained in deflation at –1.3%.