Shanghai's plate prices put off potential buyers
Shanghai produces nearly one-third of the country's total sedans, but buying a car is still not easy for upwardly mobile Shanghainese due to increasing licence plate prices.
The city authority controls the number of new cars on the road by strictly limiting the issuance of new plates to the public through auctions.
Due to that policy, the average price of Shanghai's licence plates hit a record high of over 40,053 yuan (US$4,820) at the monthly auction over the weekend. In January, the average price stood at 39,516 yuan (US$4,770), also a historic high compared with last year's figures.
No signs have emerged so far to herald that the restriction on new cars would be lifted, despite the fact that two major auto makers are ambitiously expanding their production in the city. As well, the total population has grown close to 20 million and yet there are less than 2 million vehicles on Shanghai streets.
The city's continuously rising plate prices, which are already top among mainland cities, came after a series of restrictions by neighbouring cities to sell plates to Shanghai residents.
Earlier, another three cities - Kunshan in Jiangsu Province, Yuhang and Jiashan in Zhejiang Province had blocked the issuance of licence plates to Shanghainese, following the example of administrators in Suzhou and Hangzhou.
"The car price may continue to drop, but I don't believe the prices for Shanghai's licence plates will decrease," said a local resident surnamed Hua, who won a bid at Saturday's auction.
"A lot of my relatives and friends have got driver's licences and most of them intend to buy a sedan there is a strong demand," Hua said.
Shanghai auctions off plates to individuals and private companies at a sealed-bid auction every month.