If you are stuck in Beijing traffic, while police closes the center lane to give preferential treatment to a government motorcade, you will notice a penchant for foreign brands amongst Chinese government officials: White license plates (= government) are usually found on bigger bore Audis, BMWs, and Mercedeses (or “Benz” as they are called in China.) After all, they are made in China in joint ventures, and only petty people will point out that an Audi A8, a Volkswagen Touareg, or a Benz S Class are imports.
The tastes are about to change, albeit not too drastically.
Chinese authorities are publicly thinking about new regulations to increase the ratio of domestic brand cars to more than 50 percent in government procurement of official cars, reports Xinhua. The government is the biggest customer of cars in China, with an annual budget of around $15b. The total value of official-car purchase is 8 percent of the total value of car sales in China.
Not only are government officials being asked to buy Chinese. They are also urged not to splurge.
Under the proposed regulation, ordinary vehicles of all government departments nationwide should have an engine displacement of up to 1.8 liters and cost less than $23,500.
Ministers and provincial heads should make do with an engine displacement of up to 3.0 liters and a price below $66,000.
Domestic car manufactures welcomed the new regulations, saying they will be given a boost by the change. We’ll keep an eye on Beijing’s center lanes to monitor whether the new regulations will make a difference. Others are watching as well. So far, China’s Procurement Center of the Central People’s Government (PCCG) has deemed 721 vehicles as excessive or extravagant. A drop in the bucket, we’d say.
some of the animals in ‘animal farm’ are a bit more equal than others
Not sure the wives and girlfriends will like this too much.
I said it before on TTAC and someone told me I was wrong:
Chinese people who can afford to get import brands REFUSE, and i mean ABSOLUTELY REFUSE to buy anything made in China. Chinese people (unlike the American import quality review board) are smart enough to know that anything made in China is the cheapest in quality; the most likely to break down and probably made of toxic materials wearing out at a molecular level.
Is it any suprise the toys and food coming from China are high in toxic chemicals? Or even their dry wall for home improvement breaks down and smells like rotten eggs?
I lived there for a long time and I know the people well. They REFUSE to buy Chinese knockoffs and will actually go the distance for a Cadillac, Ford, Audi, D&G, Gucci or any other “real” merchandise.
What’s funnier is after they get “real” stuff they wear it with pride and show it off to foreigners like myself.
Uh, my Lenovo laptop (nee IBM Thinkpad) is widely considered to be one of the higher quality devices in the marketplace. 3 years, no problems. That’s more than I can say for other laptops around me.
Also, your observations are quaint. They were saying the same things about cheap Japanese junk back in the 1960s. Now the Japanese are building Boeing’s wings.
This is quite true. Name brand products usually sell for significantly higher prices in China than they do in western countries (probably due to high demand), even though a lot of them are made in China (especially apparels), and Chinese have lower income overall.
When I was in China I visited the homes of several elementary school teachers, they all had expensive furniture and giant flat-panel TVs. A TV like that usually costs them several months of salary. I also visited a farming family in the countryside, they bought a Dodge Caravan instead of a Chinese brand with the money they made in the cities over the years driving taxis and working in factories, because the model has a better reputation.
The Chinese seem to be willing to spend a much higher portion of their income (than western countries) on the best clothes and electronics, and if they can, on cars as well. Middle class families are also known to spend liberally on interior decoration. The Chinese are also generally picky on food, but ample supply seem to have kept the price down. The number of restaurants and variety is simply mind-boggling. The stuffs that we call “Chinese food” in North America is just pathetic.
Flashpoint: You’ve got to come back for an update. This year, the Chinese have bought more than 13 million cars, and only a few hundred thousand are imported.
As far as car brands go, the share of homegrown brands is 44 percent and rising. The BYD F3 is leading the sedan charts. Chinese know exactly that their VW or Buick is Made in China, and they make a fine differentiation between a locally made BMW and an imported one. Nevertheless, due to cost, the imports are for the chosen few.
In the fashion dept., it is true that the Chinese usually won’t get caught with a “knock-off” brand – the fake markets are filled with Western tourists. Chinese either get the real thing, or something they can afford. A real Gucci bag still costs half a year’s salaries of a young secretary. If she can’t find a rich boyfriend who buys her one, she goes with something reasonable and local.
That’s the exact same thing someone else already said to me. Just because Chinese “want” import brands doesn’t mean they can always afford them or even find them to buy.
Sometimes we can’t always go the distance and save our funds to afford the better product. Sometimes we have to buy now.
The vehicle on the left looks to me like a Volvo 960. Can someone confirm?
If so, then a push for the gov’t to buy more Chinese vehicles should combine nicely with Geely’s purchase of Volvo. If it qualifies as a Chinese vehicle now, Volvo could sell more cars to the Chinese gov’t in 1 year than it did worldwide in 5? 10?.
I’m not criticizing Volvo. Just putting a thought out there for comment.
Seems to be a Chinese made VW Santana, known as the Quantum in the US in the eighties.
With turbocharging, the Chinese government displacement limits are fairly reasonable. A 1.8 liter version of the VW 2.0 liter direct injection turbocharged engine design would provide enough power for a responsive midsize sedan, for example. I expect an emphasis of turbochargers instead of increased engine displacement in future Chinese cars. Combine the Chinese government engine displacement mandate with near future turbo fours from GM and Ford and it looks like we’ll have a lot more turbocharged mainstream cars in the new decade.
I’m too lazy to look it up myself: Where is China on pollution control? Isn’t their dirty car exhaust their biggest health threat?
Cars are actually a small contributor. It’s mostly coal plants, construction sites, and two-stroke engine scooters. Also China doesn’t have expensive clean diesel, so as to keep food prices low (that’s why they’re a big pusher of hybrid and electric drivetrains). They are also currently building subways and nuclear plants like mad.
drivebywire: Interesting point. Whether Volvo will count as a “domestic brand” remains to be seen. Volvo will be owned by the Hong Kong holding company of Geely. Technically, Hong Kong is regarded as “overseas” – Chinese nationals need a visa to get into HK, and a lot of the “foreign investment” into China flows via Hong Kong. If Volvo counts as “domestic,” then a privately owned car company (Geely) could sell cars unencumbered to the government, whereas government-owned companies engaged in joint ventures (such as SAIC, FAW, Brilliance, BAIC) would be restricted by the new regulations. We’ll see how that works out.
Tosh: Big cities such as Beijing and Shanghai have enacted tough regimens. Can’t enter with anything less than Euro 4, which is quite good. Stinkers are being euthanized en masse. The air quality drastically improved last year. As mentioned by psmisc, cars are now a small contributor.