Access to premium cars much easier now

SHANGHAI - From the latest designer fashion to the most cutting-edge high-tech products, China's increasingly open market has brought the world's best goods to it doorstep.

Through the government-supported parallel import plan, more Chinese consumers enjoy easy access to overseas premium vehicles like Porsches and Land Rovers, and their enthusiasm has set cash registers ringing amid softening sales in the broader market this year.

In the first eight months of the year, auto parallel imports - that is, vehicles brought from other markets for sale in China - surged by 47.2 percent year-on-year to 110,000 units.

This has accelerated from 16.3 percent growth in 2016, which saw the total number of cars imported from the parallel imports plan at around 133,000 for the whole year.

Meanwhile, a total of 1.04 million automobiles were imported in 2016, a decrease of 3.4 percent from 2015, according to the China Automobile Dealers Association.

Unlike traditional imports, the parallel-import plan allows local auto dealers to directly purchase vehicles from foreign markets. Prices for parallel import automobiles, most of which are premium models, are usually 15 percent lower than dealers' listings authorized by automakers.

China started to pilot the parallel-import plan in its Shanghai free-trade zone in 2015 and later extended it to other free-trade zones, including Guangdong, Tianjin and Fujian. The government sees the program as a key measure to boost its ongoing supply-side structural reform, which could further facilitate the auto trade and provide more consumer choice.

In 2016, the Chinese government issued a guideline on parallel import cars, asking authorities to streamline procedures related to the program, to cut clearance costs for dealers and to improve registration services for parallel imported vehicles.

The rapidly growing business has even attracted market leaders in auto imports, like Sinomach Automobiles, an automotive trading service provider under the China National Machinery Industry Corp (Sinomach), which started its parallel import business this year.

"We hope the parallel imports plan can add more international models to the domestic market," says Li Li, project manager of Sinomach's parallel imports program.

Xinhua

(China Daily European Weekly 10/13/2017 page27)