Eagers Automotive Ltd (ASX: APE) has delivered solid returns for shareholders over the past year.
Eagers Automotive shares are up 75% over the past 12 months and have gained more than 55% since the start of the year.
And Macquarie Group Ltd (ASX: MQG) is forecasting further gains for Eagers shareholders.
Established more than 100 years ago, Eagers Automotive owns and operates motor vehicle dealerships in Australia and New Zealand.
The company sells and services a range of leading vehicles, including BYD, Toyota, Hyundai, Ford, and Nissan.
Macquarie notes that Eagers' market performance over the past six months was "better than expected" after a strong May and June.
And BYD, which has overtaken Tesla to become the world's biggest electric vehicle manufacturer, is leading the charge for Eagers.
Sales for Australia's new vehicle market were down by 1.4% over the last six months.
But Eagers' high exposure to BYD saw the reseller buck that downward trend.
Macquarie noted that BYD sold around 34,000 vehicles in Australia over the past 12 months while BYD sales had risen by 144% during the first half of 2025.
And Eagers benefitted from the lion's share of BYD's Australian sales with a BYD market share of around 66%.
As such, Eagers delivered 23,400 BYD vehicles during the first half of 2025, already meeting 78% of its BYD volume guidance for the year.
And Macquarie is forecasting BYD's growth to continue along with Eagers' sales.
BYD has aggressive global growth plans, and we expect it will continue to grow its market share in Australia.
This should be supported by the further expansion of its retail footprint and model range, over the next 6–18 months.
Chinese cars to dominate
The Centre for International Economics is also forecasting a change in Australia's automotive landscape.
A recent report by the research firm noted that Chinese-manufactured cars currently account for around 17% of new car sales in Australia.
But by 2035, that figure is expected to reach 43%, establishing China as Australia's leading vehicle supplier.
What next?
With 50 BYD dealerships across Australia, Eagers has retained a solid position as a BYD reseller despite encroaching competition and an end to its exclusivity agreement with BYD.
BYD's push to operate its own dealerships in the region and take control of importing and distributing those vehicles may constrict Eagers' dominant position as a BYD reseller.
Still, Macquarie is backing Eagers.
"By the end of CY25 we expect there to be ~100 BYD dealerships in Australia, of which APE should own 65-70.
This would see its BYD dealer market share hold relatively constant."
Macquarie sees significant upside for Eagers Automotive shares and increased its price target to $20.60.
Eagers shares are currently trading for around $18.58 each, which implies a potential upside of about 11% over the next 12 months.
