Above it all

As the financial crisis roils the world, and the US auto industry plummets and the European market sags, some luxury vehicle manufacturers are still resting easy due to their confidence in the China market where, despite a slowdown in the auto industry, Rolls-Royce opened its sixth showroom on the mainland last month.

The new showroom in Hangzhou comes after ones in Beijing, Shanghai, Shenzhen, Guangzhou and Chengdu. Rolls-Royce has about 100 showrooms worldwide.

"This latest milestone is the first of several showroom openings that we announced in our Asia-Pacific expansion plan at Auto China 2008 in Beijing, earlier this year," says Tom Purves, CEO of Rolls-Royce Motor Car.

"The facility signals our commitment to serving the customer better and caters to our expanding product range here in China," says Purves.

Since Rolls-Royce entered Chinese market in 2003, China has surpassed Japan and Middle East to be the group's third largest market, only behind the United States and its home market in the United Kingdom.

The company sold more than 100 of its luxury sedans in China last year, among its annual production of close to 1,000 units, 51 percent growth over 2006.

The strong sales make the company confident of further growth.

There are already 200 to 300 Rolls-Royces on the road in China, Purves says. "Our ambition for the China market is no barriers, because it's such a fantastic society, with an enormous population and dynamic economy."

"Traditionally we don't choose to target consumers. People can find our product - a car with great presence, exclusivity and refinement - for any sophisticated market, for all ages and all orientations," says Purves. "However, it's interesting that our customers in Chinese market are much younger."

According to him, the average age of Rolls-Royce owners in China is between 38 and 40, about ten years younger than Rolls owners outside China.

As with other luxury products, the Chinese nouveau riche have been the main purchasers.

While the cost of a Rolls in China starts at 7 million yuan and can easily go much higher for customized versions, the brand doesn't worry about a lack of orders.

According to 2008 Hurun China Rich Report, there are around 200 Chinese with assets over 10 billion yuan, 2,000 Chinese with assets more than 1 billion yuan, 50,000 people with over 100 million yuan and 800,000 people with more than 10 million yuan.

The 2008 version of the annual Chinese rich list defines a Chinese nouveau riche individual in 2008 as one who spends at least 82.99 million yuan per year.

There are 50,000 Chinese at least who meet the standard.

"With its discerning and sophisticated buyers, China is undoubtedly a trend-setter for the region of Asia-Pacific," says Purves. "We are looking into future to see China becoming quite a large part of our total business."

Rolls-Royce has brought four of its models to China, the Phantom, the Phantom Extended Wheelbase, the Phantom Drophead Coupe and the Phantom Coupe.

The Phantom remains the best-selling super luxury car in the world, with sales in 2008 breaking all previous records. A new Rolls-Royce model called the RR4, priced slightly below the Phantom, will be launched around the turn of the decade.

The newly launched Phantom Coupe, a two-door four-seater grand tour vehicle, combining exquisite craftsmanship and advanced engineering, is already sold out until the end of 2008.

It has led to more new buyers embracing the brand - nearly two-thirds of the Coupe's customers worldwide have not owned a Rolls-Royce before.

Also last month, the British premier luxury roadster Aston Martin announced it was officially entering the China market in Beijing.

The company aims to sell 100 super roadsters at 2 million yuan apiece minimum in China by the end of 2008, and 500 autos by 2010.

Another British premier automaker Bentley, with prices ranging from 2 million yuan to 12 million yuan, has delivered 250 sedans to Chinese consumers in the first half of 2008. Bentley says China will surpass Japan to be its fourth largest market by the end of this year.

(China Daily 10/20/2008 page3)