1、1China Behind the WheelTHE year 2009 saw unprecedented developments in Chinas auto market. By the end of October, the national volume of sales had reached 10 million, representing a year-on-year increase of 40 percent. Chinese drivers-to-be are lured by the freedom of the open road even as they tail
2、or their schedules to allow for traffic congestion. “I Wanna a Car!” In Yayuncun Auto Trade Market, one of the largest in Beijing, customers packed the exhibition hall. “Could I get a car right now if I pay in cash?” Mao Wenjun asked several salesmen but got “no” without exception. Mao was a worker-
3、bee earning an average wage of about RMB3,000 a month. In the past 20 years, he had never dreamed of owning a car himself. However, the desire grew as one after another of his friends and colleagues bought cars. “I prepared a budget of RMB 100,000, enough for a small one with 1.6L displacement. That
4、 would be perfect, either for working or 2family outing,” he said. But even salesmen didnt know where Mao, with his suitcase of cash, could pick up a car instantly. “We are out of stock. For some models, orders are stacked inches high,” a salesman told Mao. “Many people have to wait for as long as t
5、hree months. Some dealers are planning to jack up prices, not to mention discontinue any discounts.” Since March 2009, one of salesmens main tasks is not trying to get more customers but trying to get more cars. Policy-oriented Growth As for the reasons, Zhu Yiping, assistant secretary-general of Ch
6、ina Association of Automobile Manufacturers (CAAM), explained that many factors contributed to the booming market, including accelerated industrialization and urbanization, signs of economic recovery and general restoration of public confidence in consumption. But the main driving force is likely th
7、e stimulus package issued by the State Council at the beginning of 2009. The aim was not just to encourage consumption, but also to promote the types of autos with lower greenhouse gas emissions. The feedback from the market has been 3good. “Nows the time to buy,” concludes Mao, who has been enthusi
8、astic about a model for a long time, “rather than wait any longer.” The stimulus package halves government taxes on the purchase of an automobile, so he will pay 4,273 yuan on his ideal car for example, compared to 8,547 yuan under the previous, normal tax rate. “My savings will buy me a set of exce
9、llent seat covers or car stereo.” Meanwhile, a government-funded project “autos to the countryside” is geared for less developed rural areas. “This has been embraced by farmers who have joined Chinas urban dwellers in their growing demand for autos,” Zhu points out. In Chinas vast countryside, the c
10、onsumption rates remain quite low and auto ownership as a ubiquitous expectation is still in its initial stages. Be Careful What You Wish for Consumers and manufacturers are going flat out to put all of China behind a wheel, but have they gone too far? Dong Yang, CAAMs executive vice-president and s
11、ecretary-general, believes not. As China is still undergoing urbanization, the 4GDP per capita is just under the US $3,000 benchmark, which means more and more people can afford to buy a car. “The experience of developed countries is that rapid growth in the auto market slows down or declines when s
12、aturation reaches 500 cars for every 1,000 people. So far, there are 38 per 1,000 in China, while the worlds average is 120 per 1,000. There is still considerable potential in China.” Meanwhile, traffic jams have turned the trunk roads in many cities into long,thin parking lots. “Traffic jams are a
13、nightmare for me,” sighs Zhu Li, an office worker in Shanghai. “Where have you been jammed?” has become a popular question on the mobile phone. Considering the auto industrys contribution to economic growth, employment and consumption, purchasing incentives are expected to continue for quite a long
14、time. However, problems linking cars to roads, resources and the environment will not keep a low profile. How do we provide a healthy environment for the sustainable development of the industry? “China should consider its options holistically, and encourage new fuels and smaller cars,” Dong suggested. “As the structure of consumption guides the production of auto makers,the government should introduce more detailed measures to promote energy-5saving and environmentally friendly consumption, like a fiscal subsidy or tax abatement.”
