Dragons on the road – The Business & Financial Times

As Chinese automakers flood African markets with affordable, feature-rich vehicles, the ripple effects risk dismantling a decades-old used-car trade ecosystem, with consequences extending far beyond the showroom.

By Edem Mayford Kofi YEVUTSEY

At a busy car garage in Accra’s Abossey Okai, Elvis Mensah is struggling to sell a 2019 Honda CR-V listed at GH₵400,000 (approximately US$36,000). A few years ago, this would have been a routine transaction.

Today, the reason for his difficulty is parked a few lots away: a brand-new Jetour T2 SUV, available at roughly the same price, with a manufacturer’s warranty, a zero-accident history, and a suite of modern technology that a six-year-old salvaged Honda simply cannot match.

Elvis’s predicament captures a tectonic shift unfolding across Africa. In 2025, China exported 7.1 million vehicles – a 21.1 percent year-on-year increase – cementing its position as the world’s largest automotive exporter. Chery led with 1.34 million units, while BYD crossed the one-million-export mark for the first time, recording 140 percent growth.

In the first five months of 2025 alone, 222,000 Chinese vehicles were shipped to Africa, a 67 percent surge year-on-year. Industry analysts project that Chinese market share in the Middle East and Africa will rise from 10 percent in 2024 to 34 percent by 2030.

The forces behind this surge extend well beyond pricing. Massive state-backed industrial policy, vertically integrated supply chains from lithium mining to final assembly, and a structural cost advantage of 20-30 percent over European rivals have given Chinese automakers a formidable edge.

New energy vehicles now account for 35.7 percent of all Chinese auto exports. Equally important is the strategic sophistication of market entry: brands such as BYD, Chery, and Jetour are investing in dealership networks, localised financing, and after-sales service across Africa, rapidly eroding the “low-quality myth” that once constrained their market penetration. In South Africa, Chinese brands have already captured 15 percent of the passenger vehicle market.

Figure 1: Chinese automaker market share in the Middle East and Africa is projected to more than triple from 10 percent (2024) to 34 percent (2030). Source: Industry analyst projections.

The Billion-Dollar Used Car Architecture Under Threat

To understand why this matters beyond consumer choice, one must recognise the intricate global trade architecture it threatens. Africa is the world’s largest destination for used-vehicle exports, accounting for 40 percent of all second-hand cars traded globally.

West Africa alone imports more than 900,000 used vehicles annually. In Ghana, 90 percent of cars on the road are imported used vehicles; in Nigeria, more than 200,000 used cars arrive each year, representing 95 percent of the market. The continent’s used-car market exceeds US$48 billion annually.

This trade is a sophisticated ecosystem with deep institutional roots. When an American insurer declares a vehicle a total loss, major salvage auction platforms (Copart and Insurance Auto Auctions) channel approximately 35 percent of their inventory overseas, primarily to Mexico, Eastern Europe, and West Africa, where lower labour costs make reconstruction viable.

Salvage revenues offset insurers’ claim payouts and constitute a material line item on their balance sheets. The entire corridor, from the American accident scene to the West African workshop, functions as an integrated economic system that employs auctioneers, freight forwarders, customs brokers, and thousands of skilled artisans.

Africa is not the only secondary market at risk. Southeast Asia’s used-car market, valued at US$32.4 billion, absorbs significant volumes from Japan and South Korea. Central Asia has emerged as a booming corridor, with Uzbekistan alone importing 360,000 vehicles in 2023.

Latin America, particularly Chile and Peru, imports substantial numbers of salvaged vehicles from North America, while Dubai serves as a major re-export hub for the Middle East. Each of these regions faces disruption from the same competitive force now transforming Africa.

Figure 2: Africa’s extreme dependence on used vehicle imports (left) makes its markets highly vulnerable to disruption from surging Chinese vehicle exports (right). Source: Article data.

“A brand-new Chinese SUV now costs the same as a six-year-old Honda that has been salvaged after an accident. For the African buyer, the calculus has fundamentally changed.”

Tariff Walls and Unintended Consequences

The Western response has been muscular. The United States quadrupled tariffs on Chinese EVs to 100 percent in September 2024. The EU imposed anti-subsidy duties of up to 35.3 percent before pivoting in January 2026 to a negotiated minimum price-floor framework. These measures may protect Detroit and Stuttgart in the short term, but their most consequential impact may be felt in Accra, Lagos, and Nairobi.

By creating hurdles for Chinese vehicles in premium Western markets, tariff walls risk accelerating the shift of Chinese export capacity towards emerging markets with lower barriers. Africa, with its young, rapidly urbanising population and enormous unmet demand for affordable mobility, is the most attractive alternative.

Western protectionism, designed to shield domestic industries, may hasten the collapse of the used-car trade corridors that have long served as a revenue-recovery mechanism for those very industries. Lower demand for second-hand Western vehicles translates into reduced salvage values for insurers, diminished freight volumes for shipping companies, and shrinking revenues for reconstruction workshops that have sustained communities across West Africa for generations.

From Assembly Lines to Arsenal: The Weapons Pivot

The competitive calculus facing Western automakers has taken a further dramatic turn. Early this year, the United States Department of Defense announced plans to enlist American automakers, including General Motors and Ford, in the production of munitions and military hardware.

If American automakers redirect even a portion of their factory output towards defence contracts, the volume of new vehicles entering domestic markets will decline. The Western automotive industry, already taking a beating, risks further ceding market share to China.

“The same Western governments that imposed tariffs to protect their auto industries may end up cannibalising those industries for military use – while Chinese automakers fill the civilian vacuum in Africa.”

The Shadow Trade: Stolen Vehicles and Eroding Trust

A separate but equally consequential development is undermining the used-car trade on the demand side: the growing exposure of international automobile theft networks that funnel stolen vehicles from North America to African markets. In March 2025, INTERPOL’s Operation Safe Wheels – a two-week crackdown across twelve West African nations – recovered 150 stolen vehicles, primarily from Canada, that had been smuggled into Nigeria and other countries.

In December 2025, Canadian authorities dismantled a criminal export organisation in Project CHICKADEE, recovering 306 stolen vehicles destined for West Africa and the Middle East and arresting twenty individuals. As recently as February 2026, a violent carjacking ring targeting luxury vehicles in the Greater Toronto Area was broken up, with stolen Mercedes-Benz cars intercepted en route to Ghana.

The scale of the problem is staggering. INTERPOL has reported detecting approximately 200 stolen vehicles leaving Canada each week. For the African buyer, these revelations pose a deeply uncomfortable risk. When purchasing a used vehicle imported from North America, there is now a non-trivial probability that the car was stolen, with the risk of legal consequences, seizure by authorities, and total loss of investment. This risk compounds the problems inherent in second-hand purchases: hidden accident history, undisclosed mechanical damage, and the absence of a manufacturer’s warranty.

The reputational contamination extends beyond individual transactions. As arrests mount and impounded vehicles make headlines across West Africa, the entire used-car import corridor risks being associated with criminality in consumers’ minds. A buyer weighing a used 2019 Honda of uncertain provenance against a brand-new Jetour T2 with a factory warranty and traceable origin now has one more compelling reason to choose the Chinese option.

“When the car you are buying might be stolen, impounded, or confiscated, the factory-fresh Chinese alternative stops being merely attractive. It becomes the only rational choice.”

The Workforce at the Crossroads

Perhaps the most urgent issue is the impact on employment. In Ghana’s Abossey Okai, thousands of mechanics, panel-beaters, spray painters, and spare parts dealers rely on a steady flow of imported used and salvaged vehicles. In Cotonou and Lomé, the transit trade generates employment and tax revenue that are integral to national economies. Across sub-Saharan Africa, the automotive aftermarket supports millions of livelihoods.

The transition to newer Chinese vehicles, with advanced electronics, hybrid powertrains, and digital control systems, poses a direct skills challenge. Mechanics who expertly reconstruct a crashed 2015 Toyota may lack the diagnostic tools and training to service a 2025 Chery Tiggo with turbocharged engines and advanced driver-assistance systems.

Spare parts supply chains built around Japanese and European marques must adapt to entirely different component ecosystems. Without proactive investment in technical and vocational training, redundancies across these value chains could exacerbate unemployment in African economies.

Additional challenges compound the picture. Road infrastructure is one: more affordable cars from China mean more vehicles on the road, which will put pressure on road infrastructure, especially in African cities. Environmental regulation is another: as Chinese EV exports to Africa surged by 184 percent in 2025, exceeding US$1 billion, governments must urgently develop frameworks for battery disposal, charging infrastructure, and end-of-life vehicle management.

Perhaps most critically, a rapid pivot to Chinese automotive dominance risks replacing historical dependence on Japanese and European vehicles with a new form of trade concentration – one that gives Beijing considerable economic leverage over a continent that still lacks substantial local manufacturing capacity.

Charting a Course Forward

This transformation is not a crisis to be avoided but a transition to be managed. First, African governments must invest in automotive technical training and negotiate skills-transfer provisions as a condition of market access – Chery’s US$20 million commitment to Kenya’s EV sector, including a planned Nairobi assembly plant, offers a template.

Second, the African Union should develop harmonised automotive standards to ensure safety and environmental compliance for all imports, regardless of origin. Third, African nations should leverage the competitive dynamics between Chinese and traditional automakers to attract local assembly investment, requiring Chinese brands to establish local operations that create jobs and build industrial capability.

Fourth, comprehensive transition support programmes must cushion workers displaced from the used-car ecosystem through retraining and social protection. Finally, the opportunity to leapfrog to cleaner mobility must not be squandered: governments should develop coherent electric-mobility strategies covering charging infrastructure, grid planning, battery recycling, and fiscal incentives.

A Defining Moment

The irreversible march of Chinese automobiles into Africa is not harmful; it creates new opportunities. The question is not whether Chinese cars will dominate African roads – market dynamics already point decisively in that direction. The question is whether African nations will be passive recipients of this transformation or active architects of it.

For Elvis in Accra, the immediate concern is how to sell a secondhand Honda in a market that prefers a brand-new Jetour. For policymakers, the stakes are far higher. The decisions made in the next three to five years will determine whether the Chinese automotive wave creates new industries, skills, and opportunities on the continent — or simply replaces one form of external dependency with another, leaving displaced workers and dismantled value chains in its wake.

The writer is a global business leader working at the nexus of international trade and diplomacy, product strategy, AI and data science, and complex stakeholder management.

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