Chinese Car Owners Face Resale Problems As Vehicles Lose Value In South Africa

South African motorists who purchased Chinese vehicles several years ago are facing an unexpected financial challenge, with some discovering that their cars are worth significantly less than the outstanding amounts they still owe to banks.

The growing problem has raised concerns about the resale and trade-in values of Chinese vehicle brands, which have rapidly increased their presence in the South African automotive market over the past few years.

According to Combined Motor Holdings (CMH), one of South Africa’s major motor retail groups, the sharp depreciation of certain Chinese and Asian vehicles is creating difficulties for motorists who want to upgrade or replace their cars.

In its interim results for the six months ended 31 August 2026, the group highlighted the challenges associated with the growing number of Chinese vehicle manufacturers entering the local market.

Chinese brands have become increasingly popular among South African consumers, largely because of their competitive pricing, modern features and attractive vehicle specifications.

CMH reported that Chinese brands increased their share of national vehicle sales from 14.8% to 20%, demonstrating the significant impact they are having on the industry.

However, the company warned that the rapid expansion of manufacturers and models has made it difficult to determine which brands will maintain their competitiveness and retain their value over the long term.

The problem is becoming particularly noticeable among motorists who purchased Chinese vehicles approximately four to five years ago.

These vehicles are now reaching the stage where owners would traditionally consider trading them in for newer models.

However, the depreciation experienced by some vehicles has left owners with trade-in offers that fall below their outstanding finance balances.

This means motorists may have to contribute additional money to settle their existing vehicle loans before they can purchase another car.

CMH said the sharp depreciation had surprised many owners, forcing some to postpone their plans to trade in their vehicles until their trade-in values become more closely aligned with the amounts they still owe to financial institutions.

The situation is also being influenced by competition from new vehicles.

Aggressively priced new models have become increasingly attractive to consumers, while relatively stable or declining new-car prices have placed additional pressure on the second-hand market.

CMH reported a 10% contraction in used-vehicle sales during the period, despite increasing its new-vehicle sales by 11.2%.

Meanwhile, the growing number of ageing Chinese and Asian vehicles is creating opportunities in the aftermarket parts industry.

The group said its alternative-parts supplier, MPD, had experienced increased demand as vehicles leave their factory warranty periods and owners seek more affordable maintenance options.

For motorists, the experience highlights the importance of considering depreciation, resale value and long-term ownership costs when purchasing a vehicle.

Although Chinese brands continue to attract buyers with competitive pricing, their future performance in South Africa’s second-hand market remains an important consideration for consumers.