Used car market slams into top gear

Updated 2018-02-12 13:48:01

An exhibition of used and classic sports cars in Tianjin attracts throngs of visitors.

Industry experts say second hand auto sector really taking o after removal of trading barriers.

China's used car market ratcheted up record volumes in trade last year and is poised to expand further in 2018, according to industry experts.

More than 12.4 million second hand vehicles were traded in the world's biggest auto market in 2017, an annual growth rate of 19.3 percent, statistics from the China Automobile Dealers Association showed. Another historical high was also hit in monthly trading volumes last year, with December seeing 1.23 million used cars change hands, up 13.8 percent compared with December 2016.

"The second-hand vehicle market has lurched from the edge to the center of the stage," said CADA Secretary-General Xiao Zhengsan, earlier this month in Beijing.

"In the past two years the State Council, central government bodies, and local governments have attached great importance, as never before, to second-hand car trade," he added.

In March 2017, three ministries began a survey of provincial governments about progress in removing bans on trading in non-local used cars, while the State Council indicated it was ready to direct an inspection team to regions where trading was slow.

The used vehicle trade across administrative borders reached its decade top, and the market was much more active last year when comparing with that in 2016, according to Luo Lei, deputy secretary-general of the association.

Another stimulant to second hand car trade was the removal in China by 135 local authorities of barriers that prevented used cars from one province being sold in another.

"This is the market response to abolition of the bans in many cities, especially those around the major sources of the used cars," Luo said.

The conurbations of Beijing and Tianjin are among the top sources of second hand stock, and the majority of used cars are moved to the adjacent regions, including Shandong province and Inner Mongolia autonomous region.

Luo said one eye catching example of the explosion in the sector's growth was Zaozhuang, a third-tier city in Shandong province. Statistics showed that more than 939,000 used vehicles were registered there last year, a 78.7 percent surge from the year before.

The eastern province, which experienced slow-lane trading in second hand cars in previous years, only removed its ban on non-local second-hand vehicles from June 2017. Industry insiders said the province dragged its feet on implementing new market reforms, especially the measure removing the ban on selling non-local used cars, which resulted in sluggish flow of stock and insufficient supplies.

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