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Luxury Cars October 2012

“I do not think there is a crisis in the Chinese market. In the first eight months, the overall automobile market grew 8% -10%, however the luxury car market in China grew 28%.” Christoph Stark President & CEO of BMW Group Region China

Car sales in China the months previous to September where for many manufacturers very poor, but September saw significant gains in volume particularly for German executive brands Audi, BMW and Mercedes. The recovery is considered to be a result of:

  • Special price promotions by some brands, and in some cases web based offers which sold out very quickly
  • Significant effects of the pre Golden Week holiday period when consumers buy to be sure to have a new vehicle ready for the one week national holiday
  • Some customers deciding that the political issues China has with Japan over the Diaoyu Island were enough to cause them to replace their Japanese car with one from elsewhere sooner than they might otherwise want to

Attacks by Chinese people on Japanese property and in particular cars was high across the country in September, particularly in Tier 2 and 3 cities as a result of the Diaoyu Island dispute. In Qingdao a Toyota 4S dealership was burnt, and naturally car sales for all Japanese brands was badly affected. As a result, an estimated 14,000 cars were not sold with a value of US$250 million. Both Nissan and Honda will cut production in October, and Toyota has announced that they will not ship any Lexus vehicles to China this month.

Away from the political influence over consumers, the results of other brands were very good. BMW sales grew 59%, Audi 20% and Mercedes 12% overall. The number of 4S dealerships increased in both established and new cities across the country, for example this month BMW will establish a Mini 4S dealership covering 12,000 sqm in Beijing that will be the largest in Asia


In September, Porsche sales in China rose 26% to 2,818 units. The brand also held and exhibition covering 800 sqm of the Experience Center in Zhejiang Museum of Natural History. Currently the brand has 46 authorized dealers in China, and expects this number to increase to 60 by the end of 2012.

Jaguar Land Rover

The 10 Billion RMB JV between China’s car manufacturer Chery and Jaguar Land Rover has been formally adopted by the National Development and Reform Commission of China for approval. It is expected that Jaguar Land Rover will start to produce cars in China sometime in 2014.


Having established an e-sales platform on Taobao’s Tmall in May this year, 8000 people have ordered a new car, but so far nobody has actually paid!


Although not a brand that would be regarded as luxury in the west, Morgan prepares to open its doors for the first time in China.Initially in Shanghai, it appears to be relying on that quirky old-fashioned Britishness. Lets see how the Chinese consumers receive ‘wooden’ cars.


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