Australia’s cheapest car faces chop

AUSTRALIA’S cheapest new car, the Chinese-built Chery J1, will be removed from sale by the end of 2013, and importer Ateco Automotive is still to decide whether it can justify a similarly priced replacement.

As previously reported, the company slashed $1000 from the light-sized five-door hatchback in January to a new low-water mark of $9990 driveaway, further extending the J1’s lead as the most affordable new passenger car on the market ahead of rivals such as the Suzuki Alto, Nissan Micra, Mitsubishi Mirage, Holden Barina Spark, as well as a host of used cars. The super-sharp price also made Chery the first brand with a sub-$10,000 new model in the new millennium, the last being the Suzuki Swift in 1999.

However, unlike Chery’s larger J3 hatch ($12,990 driveaway) and J11 crossover ($17,990 d/a), Ateco Automotive has now confirmed the J1 will not receive electronic stability control over the course of 2013, ruling it out of contention for the local market once the technology becomes mandatory in all states from 2014. Chery is understood to have offered Ateco access to a replacement vehicle for 2014 and beyond – the just-launched and slightly smaller QQ – but the importer’s general manager of new ventures Dinesh Chinnappa said the company was undecided on whether it could make the business case work.

Mr Chinnappa, who was in China with Chery officials last month, said the company had been in talks regarding three new models – the QQ, as well as a small-car replacement for the J3 and a larger sedan that is currently in the prototype stage. “The simple availability of a car doesn’t necessarily mean we will take it, and the best example I can give you of that is the micro-car,” he said. “They’ve asked us if we’re interested and we’ve said yes, they’ve said the indicative selling price, we’ve looked at that and thought it could work, but now we’ve got to pull back and ask ourselves will Australian consumers by a 1.0-litre car in sufficient numbers to justify us bringing it?” “It would be a cheap car, but we’re just not sure about that sort of engine.” “It’s a shifting market – Aussies used to refuse, but things like (the three-cylinder) Micra and Alto are showing that if you get the package right … and the small engines are better than they used to be. But it’s all got to add up before we do it.” A facelifted version of the twee QQ was launched in its native market last week, powered by a 51kW/93Nm 1.0-litre three-cylinder engine matched to a five-speed manual gearbox. A touch smaller than an Alto at 3564mm long, 1620mm wide and 1527mm tall, the QQ is also reportedly in line to receive a 62kW/122Nm 1.3-litre petrol engine with either manual or CVT automatic transmissions. Further details are scarce, although Chery offers six airbags and a similar list of standard equipment to the Alto and Micra on its new light-sized offerings in China.

As well as the popular Indian-built Micra and Alto, the Australian market has in recent months seen the launch of fellow budget models such as the reborn Mitsubishi Mirage and even the German-made Volkswagen Up.

But despite a growth in light vehicle sales of 9.0 per cent, Chery J1 sales have been on a steady decline for months, with just 20 units sold in February. Ateco claims to have turned off the supply tap following a recall over a seat issue in 2011, as well as several quality qualms over the ensuing period. The J1 has also never sold in Victoria – Australia’s second largest car market – as that state mandated its ESC regulations one year in advance of the rest of the country.