| Dear Mr. Wang, Reasons for sales declines at dealer outlets can be various in Shanghai. Not only are prices for cars higher in Shanghai compared to 'in the province', also more and more people choose to buy their car in other cities in combination with a local license plate (which holds limitations for Shanghai but is much much cheaper). Also, corporate (lease) sales are increasing rapidly, as well as car imports and the second hand market is, since private car ownership has now been legal for 7 years, growing rapidly as well. JDPA market reports show that dealerships in China in general and after service (income) in particular are not of the highest quality. Manufacturers struggle with margins on the cars themselves and can not compensate those with -normally- lucrative after-service income. A lot of training and maturing is needed in the Automotive Retail Industry in China, that is for sure..an interesting field to keep in check! |
Auto Industry Enters Winter in Shanghai