Car Inc gets a boost from vehicle resale plan
Car Inc, China's biggest rental company, surged the most in more than four months in Hong Kong trading on Monday after saying it will begin selling used cars next month to retail buyers, and a substantial shareholder sold its stock at a premium.
The company will start with sales in eight cities and expand to about 100 smaller ones next year by acquiring existing dealerships, Chairman Lu Zhengyao said in an interview in Beijing on Friday. It will initially sell cars that are part of its rental fleet and subsequently offer pre-owned vehicles from other providers as well as new cars, he said.
"Demand for used cars will mainly come from the smaller cities in China where the business is still fragmented. It is like we are expanding into some uncultivated land," said Lu. "We will make the best use of our rental cars as well as take advantage of our lower purchase costs."
