GUANGZHOU — Li Bo, a 28-year-old lawyer, was one of three friends who put down deposits of 50,000 renminbi or $7,500 apiece in May at a car dealership to buy a popular model, the Audi Q5, which sells for the equivalent of $72,000, including taxes, in China.
Mr. Li and one friend are still waiting for their cars; the other paid an additional 38,000 renminbi, or $5,700, to the dealership and got his Q5 within a week, Mr. Li said.
“We’re very upset,” Mr. Li said. “There are just too many people ordering.” One of the uncertainties in the auto industry lies in how much longer the Chinese authorities will allow the country’s remarkable sales boom to go on — and whether China will export a flood of cars if the authorities do clamp down.
Automakers have been struggling for years to keep up with demand in China, as sales have climbed at a pace never seen before in a major auto market. The number of cars and light trucks sold in China was one-tenth of that in the United States in 2000. This year, sales in China have been more than 50 percent higher than in the depressed American market.
The result has been traffic jams in the largest Chinese cities, particularly Beijing. And that has elicited an unexpectedly strong response from policy makers.
The Beijing municipal authorities announced last week that they would cap the number of new car registrations at 240,000 a year — just a third of the sales pace this year.
The finance ministry announced separately this week that on Jan. 1, it would restore the sales tax on cars with small-displacement engines to 10 percent, its level before the global downturn. (The tax had been at 5 percent in 2009 and 7.5 percent this year; through the downturn, the tax has remained as high as 40 percent for sport utility vehicles and sports cars with the most powerful engines.)
Auto executives and industry analysts say that the market will continue to expand in 2011. But they forecast that the growth rate is likely to fall to 10 percent after averaging 25 percent a year for the last decade. Slower growth is not all bad for the auto industry. Automakers across China have been running their factories almost around the clock, racking up costly overtime and deferring maintenance. Sudden spurts in sales, like an increase of 34 percent this year, have made it hard for manufacturers to plan how many factories they should build, and how quickly.
“Stable growth is much better for us,” Toshiyuki Shiga, the chief operating officer of Nissan, said at a news conference at the Guangzhou auto show, which closed Monday.
The biggest question being asked in the car industry is whether more cities will follow Beijing’s example and impose draconian restrictions on car registrations. Shanghai has restricted registrations for many years to prevent its ancient streets from becoming overwhelmed. As a result, it has one-third as many registered vehicles as Beijing, even though the populations of the two cities are similar.
That leaves Guangzhou, the sprawling commercial hub of southeastern China, as potentially the country’s largest single market in the coming year. With Toyota, Honda and Nissan all operating joint ventures in the city, Guangzhou has nearly caught up with Shanghai as the largest car manufacturing hub in China.
Gridlock is not yet a crippling problem in Guangzhou, or in many smaller cities across the country. City leaders are leery of discouraging car sales. “At the current time, Guangzhou does not have plans to follow Beijing’s new limit on the issuance of car license plates in 2011,” said Chen Haotian, a vice director of the city’s powerful Development and Reform Commission. “Our city has a very good subway system, which should help to alleviate big traffic jams.” Guangzhou had severe traffic jams a decade ago but then moved more quickly than Beijing did to build a huge subway network that opens 30 kilometers, or 20 miles, of new lines each year. Traffic flows more smoothly in the city than in Beijing, although Guangzhou still had to impose restrictions on who could drive, based on license plate numbers, during the Asian Games, which just ended. eek.
13. Never, ever try to sell any thing in your answer.
If you know any other techniques, please post in the comments
Mr. Li and one friend are still waiting for their cars; the other paid an additional 38,000 renminbi, or $5,700, to the dealership and got his Q5 within a week, Mr. Li said.
Christie Johnston for The New York Times
An auto show in Guangzhou this month. Industry analysts say that the Chinese auto market will continue to expand in 2011.
Automakers have been struggling for years to keep up with demand in China, as sales have climbed at a pace never seen before in a major auto market. The number of cars and light trucks sold in China was one-tenth of that in the United States in 2000. This year, sales in China have been more than 50 percent higher than in the depressed American market.
The result has been traffic jams in the largest Chinese cities, particularly Beijing. And that has elicited an unexpectedly strong response from policy makers.
The Beijing municipal authorities announced last week that they would cap the number of new car registrations at 240,000 a year — just a third of the sales pace this year.
The finance ministry announced separately this week that on Jan. 1, it would restore the sales tax on cars with small-displacement engines to 10 percent, its level before the global downturn. (The tax had been at 5 percent in 2009 and 7.5 percent this year; through the downturn, the tax has remained as high as 40 percent for sport utility vehicles and sports cars with the most powerful engines.)
Auto executives and industry analysts say that the market will continue to expand in 2011. But they forecast that the growth rate is likely to fall to 10 percent after averaging 25 percent a year for the last decade. Slower growth is not all bad for the auto industry. Automakers across China have been running their factories almost around the clock, racking up costly overtime and deferring maintenance. Sudden spurts in sales, like an increase of 34 percent this year, have made it hard for manufacturers to plan how many factories they should build, and how quickly.
“Stable growth is much better for us,” Toshiyuki Shiga, the chief operating officer of Nissan, said at a news conference at the Guangzhou auto show, which closed Monday.
The biggest question being asked in the car industry is whether more cities will follow Beijing’s example and impose draconian restrictions on car registrations. Shanghai has restricted registrations for many years to prevent its ancient streets from becoming overwhelmed. As a result, it has one-third as many registered vehicles as Beijing, even though the populations of the two cities are similar.
That leaves Guangzhou, the sprawling commercial hub of southeastern China, as potentially the country’s largest single market in the coming year. With Toyota, Honda and Nissan all operating joint ventures in the city, Guangzhou has nearly caught up with Shanghai as the largest car manufacturing hub in China.
Gridlock is not yet a crippling problem in Guangzhou, or in many smaller cities across the country. City leaders are leery of discouraging car sales. “At the current time, Guangzhou does not have plans to follow Beijing’s new limit on the issuance of car license plates in 2011,” said Chen Haotian, a vice director of the city’s powerful Development and Reform Commission. “Our city has a very good subway system, which should help to alleviate big traffic jams.” Guangzhou had severe traffic jams a decade ago but then moved more quickly than Beijing did to build a huge subway network that opens 30 kilometers, or 20 miles, of new lines each year. Traffic flows more smoothly in the city than in Beijing, although Guangzhou still had to impose restrictions on who could drive, based on license plate numbers, during the Asian Games, which just ended. eek.
13. Never, ever try to sell any thing in your answer.
If you know any other techniques, please post in the comments
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