Three people have had a miracle escape after a woman drove her Volkswagen Golf off the cliff at Bar Beach and hit a mother carrying her baby.
The 32-year-old woman's car struck a 40-year-old woman carrying her infant child on the beach before coming to rest right side up in knee-deep water.
The 40-year-old suffered suspected leg fractures and her child, aged less than 12 months, escaped with minor scratches.
A John Hunter Hospital spokesperson said both women were in a serious but stable condition on Thursday afternoon.
Police chief inspector Gerard Lawson said the child's father had been in the water when the accident happened and "he saw it all happen".
The car rolled before reaching the water after crashing through a white fence next to a Bathers Way lookout near the bottom of the Bar Beach car park at 10.25am on Thursday.
Inspector Lawson said the driver had been "very lucky".
"I've seen people not survive a fall like that," he said.
"After 11 years in the crash unit, I'm very surprised that we've got these minor injuries involved."
A witness, Denise Bloomfield, said the car had been travelling fast.
"I was walking up towards the car park. This white car came straight through the car park. It was airborne and it was not slowing down," she said.
"I heard a bang when it hit the fence. Then it disappeared.
"I took off down the stairs. There was a family down there. Amazing it didn't land on the family.
"The driver was a woman sitting in the car. The door was still closed.
"Five people went up and opened the driver door.
"I just thought, 'Oh shit.' I feel sad, too. I just thought, 'What the hell happened.' I hope they're OK. I really do."
NSW Ambulance duty operations manager Jason Saper said it was a "miracle" no one had been seriously injured.
"The car took a substantial dive off the cliff, and it was a miracle to find everyone alive when we arrived on scene," Inspector Saper said.
"We did a fantastic job today under very intense and difficult circumstances.
"They are very lucky to be alive. It was a significant fall from the cliff.
"We've seen incidents like this before that can be quite tragic. Ourselves and the public are quite pleased that they're all in a stable condition."
Police said they were investigating some witness reports that a man had been in the vehicle with the woman.
They are calling for dash-cam or phone footage from anyone in the area at the time.
Police established a crime scene and asked motorists to remove their cars from the car park to help with the investigation.
The car has since been retrieved from the bottom of the cliff.
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