| Luxury cars to hit sales wall in China Here, luxury car marques such as Rolls-Royce, Lamborghini, Aston Martin, Ferrari and Bentley jostle for position as the Hong Kong Jockey Club's branch and a mall solely featuring luxury brands look on. Among the Chinese car makers that would be likely to benefit from keeping foreign brands out is FAW Group, which builds the Hongqi, or Red Flag, a limousine first made for chairman Mao Zedong back in 1958. One-page article The street in Beijing is called Jinbao Lu, which translates as "Golden Treasure". "If you look at the economy right now, there may be some uncertainty to make people wait a little," Christian Mastro, the Asia Pacific general manager at Lamborghini, told Bloomberg last month. "The number of people able to spend this kind of money is limited; it's not unlimited. "The future growth will slow; it's not possible to have that sort of speedy growth. In 2011, sales agents were crazy, focusing on luxury cars as if growth would go on forever, but the future is not so bright. " Economic growth is slowing as the government tries to cap inflation and reduce a house bubble. Although last year Chinese car sales overall rose 2. 54 per cent, the country's lowest rate of growth in 13 years, the luxury end of the market expanded by more than 30 per cent - good news for foreign car makers. "Don't get too high expectations. The symbolism of this policy is more than the actual significance. ae/topic/columns-and-sections/building-brics> Here, luxury car marques such as Rolls-Royce, Lamborghini, Aston Martin, Ferrari and Bentley jostle for position as the Hong Kong Jockey Club's branch and a mall solely featuring luxury brands look on. The government also decided to begin an anti-dumping and anti-subsidy investigation on cars imported from the US with engines of more than 2. 5 litres. "There is no need to encourage more foreign companies as the sector is already saturated with far too many players. This might cause serious ripples among cadres and bureaucrats who treasure their Audis. Domestic cars still have a poor reputation among Chinese motorists, even if quality has improved in recent years. "Luxury car sales have been leading the growth in the whole market, but this may not be a normal phenomenon," says Cui Dongshu, the deputy secretary general of the China Passenger Car Association. Dieter Zetsche, the Daimler management board chairman, expects the company's Mercedes-Benz brand to "scale more heights" once it rolls out its complete fleet in China. How much help it will bring to independent brands is unknown," he says. "Joint venture brands won't give up too easily on the official purchasing market. Morgan is aiming for 1,500 deliveries worldwide this year, and up to 50 per cent of these cars are expected to be ordered by Chinese customers. At the end of last year, the ministry of commerce and the national development and reform commission issued a directive that ministries would no longer automatically encourage foreign investment in the motoring sector. Overseas brands still carry a lot more cachet, and this is going to be difficult for the local producers to overcome. The move would force foreign car makers out of an 82 billion yuan (Dh47. The company has just received state approval to revive the Red Flag in the shape of the C131, after spending millions on overhauling the model. The super-wealthy are sensitive to the slowdown, which might translate into lower sales of ultra-luxury sports cars. thenational. Chinese clients have to wait at least 18 months before taking delivery of the Italian sports car maker's new flagship model, the Dh3. Yet there are signs the high-end motor manufacturers are not having things all their own way. The typical buyer of a Lamborghini in China is on average 20 years younger than in Europe, a fact borne out by the vision of what looks like teenagers whizzing about the streets of Beijing and Shanghai in these supercars. Audi accounts for about one third of government and state-linked fleets. Wiesmann, a German maker of hand-built sports cars, is setting up on Jinbao Street, selling its MF4 Roadster and MF5 GT models, while the British sports car manufacturer Morgan has announced a deal to sell its range, including the Aero, Roadster and 3 Wheeler cars, in Beijing. The group is also opening an engine factory in China. Official cars are easily recognisable by their distinctive white number plates, and some have an ear-splitting horn the drivers like to blare as they zip along the emergency lanes to avoid traffic. The saloon will be the official vehicle for minister-level officials, said the website of the Communist Party newspaper, the People's Daily. Beijing is reportedly keen to crank up efforts to protect Chinese car makers from competition from overseas producers such as General Motors and Volkswagen, which owns Audi. China overtook the US as the world's biggest car market in 2009 and has also become the growth engine for global luxury models, as the gleaming showrooms on Jinbao Street testify. |
Monday, 5 March 2012
Luxury cars to hit sales wall in China
