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Discussion Starter · #1 ·
even the foreign cars that is produce in china, are foreign companies trying to ripoff hard working chinese people or what?

for example,
China Lexus 450 1350000(人民币) = $198,529 usd
USA Lexus 450 $64,680 - $73,750 msrp

Even china produced BMW is expensive

华晨宝马5系 412600- 688600 = $60676 usd - $101,264 usd
USA BMW $45,800usd - $60,400usd
 

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Hello guys!

I am moving to China for work so I checked the local price of cars. They are ridiculously high. I am not sure why even though China is already a WTO country. Should I buy a car in the UK, which offers a much cheaper bargain? Or should I buy it in China, where price of car is high? Say, if I get one in the UK, how much will it cost me to deliver it to China and is it plausible and in other words, if China adds tariff and tax on imported goods, will it actually make the foreign cars more expensive than local cars?
 

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few elements,
1 is they are imports
2 is the govt wants to create an insentive for people to purchase local brands to help job market and economy and promote consumer spending
 

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I heard it because part of foreign company strategy, since Chinese people love expensive car, the more expensive, the more attractive and prestige. That is why Lexus sell their car ultra expensive, I don't know if Chinese people know how cheap Lexus car in US. Do they feel being robbed?
 

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Reynard Daren said:
Hello guys!

I am moving to China for work so I checked the local price of cars. They are ridiculously high. I am not sure why even though China is already a WTO country. Should I buy a car in the UK, which offers a much cheaper bargain? Or should I buy it in China, where price of car is high? Say, if I get one in the UK, how much will it cost me to deliver it to China and is it plausible and in other words, if China adds tariff and tax on imported goods, will it actually make the foreign cars more expensive than local cars?

The China Customs Tax breakdown is something like this:

Under 3.0L = 66% Tax (Based On China Customs Valuation Of Vehicle)
3.1L - 3.9L = 95% Tax (Based On China Customs Valuation Of Vehicle)
Above 4.0L = 145% Tax (Based on China Customs Valuation Of Vehicle)

Please note that the huge tax is against the value China Customs puts on your vehicle. They claim to have a "very complicated system of calculations" that they use to compute the figure. Basically, it appears they choose a middle ground (probably higher than "middle") between KBB (Kelly Blue Book) value and their interpretation of Chinese market value.

Then there are additional costs as well. Freight and insurance aside, there is a hefty Acquisition Tax (50,000rmb+) and a "Customs Port Handling Fee", among others.


As an example scenario:

If you wanted to import a 2005 Range Rover HSE to China, your costs might look something like this: (in RMB / Yuan)

¥170,000 - ¥270,000 = Vehicle Purchase Price In Home Country
(*¥350,000-¥500,000 = Possible China Customs Valuation Of Vehicle*)
¥500,000 - ¥725,000 = 145% Customs Tax (4.4L Engine)
¥75,000 - ¥150,000 = Additional Costs (Freight, Aquisition Tax, Registration, etc.)

TOTAL:

¥745,000 = Possible Minimum Cost In Completing Vehicle Purchase And Legal Import
¥1,145,000 = Possible Maximum Cost in Completing Vehicle Purchase And Legal Import


The costs are hard to swallow, but if you play around with enough different scenarios, you might find something that is acceptable to you. If you are very effective at completing the import as cheaply as possible, you can still get in under Chinese market value. It's just a matter of how hard do you want to work for it.

It does make sense that a country of 1.6+ billion people would need to avoid making it too easy for people to get cars. Especially considering the infra-structure is mostly used/needed for industry. As was touched on earlier in the thread, a lot of the wealthy here are very wealthy and thus can afford the exclusivity. China has not yet fully adopted a lot of big money-sinks (yachts, jets, high-value real estate, etc), so vehicles seem to remain the primary status symbol here.

I have been living in China for a couple years now, and am still renting a car. Have looked into many different options to purchase a vehicle I would want, but thus far to no avail. The aspect I can least understand is the used car market here. It seems people think they can drive a car for several years and only lose a tiny percentage of what they paid. It's really hard to understand for us Westerners, where we lose 20-30% as soon as we drive it off the lot, haha.

Anyways, if you have any questions feel free to drop me a line. I'd be happy to help out a China newcomer any way I can.

Cheers.
 

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ruru said:
It's easy to get cars. Santanas, Wulings, QQs, and F0s are available far and wide, with zero restrictions on numbers sold.
While there are a large number of low-priced vehicles, they are still far out of reach to the average citizen here. Look at the percentage of the population that have personal cars in some of the Western countries as compared to here. China (and the world) would not let that same level of accessibility (which is by design) reach the masses here, it would be too hard to control.



In regards to your question about engine swaps. I don't have a definite answer for you, but I am a firm believer that it is "better to ask for forgiveness than permission".

I have seen lots of cars undergo engine swaps (old Mercedes, Red Flags, etc.), and it seems to be a normal process here. Not sure if people are registering these power changes or not though. I would think that if you do everything "by-the-book" before the swap, then change out the engine after the fact, it might be easy to keep that under wraps indefinitely.

Insurance could be the only issue, but I don't think it's like the West where very observant adjusters and such would be inspecting the car. You probably wouldn't be insured on whatever you put into the car, but I doubt they would ever discover the change or negate your policy on the original vehicle value.

This is China, it is safe to assume that to get permission to do something like this would be difficult. In that same respect, I wouldn't be surprised at all if you could perform the switch , drive the car forever, and never face any issues because of it. I would still take it to a shop I trust though...
 

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ruru said:
Do you know if you will even need a car? Do you know where you will be living? Do you know if there will be parking available where you live?

Driving in China can be enough of a hassle already (an army of suicidal moped riders and half blind pedestrian waits for you) and you want to drive here in a car with the steering wheel on the wrong side of the car?
You're right RURU.. It is important to have a place to live for than a place for parking lot,.Nowadays in some places are very compact, full of vehicles around it.
 

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Interesting thread.........we've talked about this before but good to revisit it. A couple of comments -

1) - Taxes ARE the determining factor as far as imported car prices. It even applies to foreign branded cars that are assembled here, but the parts are still imported - the parts are taxed as well. A couple of options to consider - some foreign branded cars are now manufactured completely in China, making the car somewhat less expensive. The new Ford Fiesta is a good example, as is the Suzuki Swift, Alto and the updated Wagon R. Lots of other examples too - look at the Ford Mondeo. Base price around 160,000rmb, nicely appointed with a automatic for under 200,000rmb. Those prices are right in line with what a car similar to the Mondeo (like the Taurus) would sell for in the USA. Want a REALLY good deal? How about the older generation VW Jetta/Santana? They still sell VERY well here (granted, taxi fleet sales help a lot), and even though the cars are based on platforms over a decade old, they are safe, ULTRA reliable and comfortable. Base price for a Jetta? 70,000rmb.........for the Santana about 80-90,000rmb. Where are you going to find german quality and reliability for that price in the USA? Simple - YOU CAN'T.

2) - The issue about the government trying to limit people buying cars? More complex than that. The fact that people are buying millions of cars here every year is not really the problem.....in fact it's good for the economy. The PROBLEM is the government doesn't want people to buy big, imported gas guzzling cars. The government wants people to buy gas friendly cars, and the recent tax laws (3% sales tax on cars with 1.5l engines or smaller and 1% sales tax on 1.0l engines or smaller) are a big incentive for sales. Bread van sales and sub-compact cars have seen double digit increases in sales figures because of the new laws, and I think that trend will continue. Now, I said this issue is more complex, and it is. The BIGGEST problem the government faces here isn't cars, it's equality of life. The people in the countryside villages don't have much access to the things that many of us take for granted.......internet, modern plumbing, easy and close access to stores that have better food and clothing. At this point in China's infrastructure growth, it's easier to bring the people to the things instead of bringing the things to the people. What is happening now is we're seeing 3-4 families in a village pool their savings together and buy a bread van or small car, and now they can drive in to the nearest small city as needed - better shopping and a better life. Increased car sales (especially in the countryside, which the government is pushing a lot) is necessary to help raise the quality of life for over a billion people - remember that only a third of China's population actually live in the bigger cities. If they can't keep the masses happy, then some very unpleasant things could happen.

3) - One more thing to consider......how should we define what a "decent" car is nowadays? 10 years ago, the thought of buying a "decent" car designed and made by a chinese car company was a pipe dream. The first Geelys and Cherys were literally cars I would laugh at when I saw them, they were so bad........the first BYD (called the Flyer) might have been one of the ugliest cars I've ever seen. Today? Where do I start? Quality control is way up (most big chinese car factories are becoming robotic, just like in the USA or Japan), reliability is up (comprehensive warranties are becoming standard for chinese cars) and interior amenities are just about equal to most imported cars now (ABS, air bags, EBD, CD with MP3/Ipod jacks, climate control, DVD/GPS - all of these things are now available on cars that cost 60,000rmb - or less). The fact is, it is quite easy to buy a "decent" chinese branded car today! Sure.....owning a foreign branded car is a status symbol for many people here, and will continue to be so. However, just owning a car is still a big deal here, and more and more chinese consumers are realizing that buying a chinese car is a viable alternative to buying a foreign car. This is also fueling auto sales as more and more people choose a chinese product instead of saving for another few years to buy a foreign product.

Whoa..........sorry about typing so much. Once my brain gets going, the fingers start flying!;) Good discussion here.....very cool.:thumb:
 

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ruru said:
Short answer: no.

Long answer: no. Chinese so far have been plenty willing to pay what in the USA we could call champagne prices for low-end beer.

I think over time average incomes will rise; the price of cars will remain the same but the affordability will change so that they become relatively less expensive even though the absolute price remains stable.
Are you Chinese? Are you not angry with the high car price in China? I think it is the people who will suffer at the end, and the street has many cheap cars compare with US and Europe.

I think most Chinese unwillingly to pay extra for a car. Well, earning money is not easy, especially in China. Actually, it's because the government is authoritarian so the people don't have other choice, instead just accepting their bad faith.

Look this year, when government give a special intensive to encourage the people to buy their first car. It's a proof that Chinese unwillingly to pay extra. Poor Chinese, no wonder if they look so poor compare with other countries people.

If you randomly ask Chinese people on street, Are you agree to lower the car price in China? I believe 99.9% will agree, because most of them are badly want to buy their first car.

I 100% support to lowering the car price in China! For the Chinese people! :thumb:
 

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What will happen after stimulus policy canceled?

Continue or not? China’s purchase tax policy trend is one of the hottest topics in China. In a recent survey on the future without the new car purchase tax policy, most of the interviewees gave a pessimistic answer.

According to the survey, over 60% responded that the market will decline sharply once the stimulus policy canceled from end of this December. Only 10% responded the market will be still on growth track by its own. Replies from automakers are even more pessimistic. 86% of total automakers said the market will turn down by this cancelling.

Mr. Liu Yu from Dongfeng Honda told reporter that “China has great market potential and the key for automakers is to make the huge demand released.” Right before this in an interview to Mr.Liu, another important voice from the General Manager of Chery Sales Company also mentioned confidence is the essential for China auto market. The crisis in 2008 is not due to demand shrinking but the lack of confidence. Once the confidence rebuild in 2009 the huge demand is still there.

The concern by most of automakers in China now is the confidence after the market starts to decline. Cars below 1.6L is the section took advantages of the new car purchase tax, and this is right the major driving force for whole auto market in 2009.

In the market survey 50% questionnaires expressed the hope to extend the policy to 2.0L models. Whatever happens at the end of this year. There is one thing to be sure that some of the demand in 2010 has be released in advance in 2009 due to the car purchase tax. Automakers can not expect the demand in 2010 is as good as in 2009. To continue making defensive production plan could be a better choice in 2010.
I don't understand the concept why the government increase the car price significantly. While at the same time the government struggling to increase people living standard to the rich country level. For most of third world countries people, owning private car is one of the major target and a symbol of improved living standard. I think it is good to reduce the car price, just like electronic products, so the people can buy all this stuffs easier.
 

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Cars are very expensive in all foreign countrys.
An italian car is more expensive in UK than in Italy.
Only the americans are getting cheap because of the $$
 

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How cheap do you want- you can get a brand-new Chery QQ for about RMB27000. A Haifei Lobo for about 40000. A new BYD F0 for about RMB35000. This is cheaper than you can buy ANY new car in the USA, what are you complaining about?
This is cheap. But Guangdong Honda Accord is not cheap, while this car is also manufactured in China. In the past they sell this car USD 22,000, but now, the last time I check is around USD 37,000. I don't understand.


Ah, there we go :) You don't just want a car, you want a large car with a decent engine!
So the reason why China car expensive, even it was manufactured in China is because of engine tax? 2.0L engine being taxed too? This is funny, but if that true, China is a eco friendly country, even with the bad air pollution.


Caroong, look out the window of your apartment. Look at all the homes you see. Now imagine if every family in your building bought a car tomorrow. Where would they park at night? You think traffic is bad now, imagine it with all those cars on the road. And if you have a car you'll want to drive it. There is barely enough parking for bikes and mopeds at your work, imagine if everyone stared driving to work- again, where will they all park?

Chinese cities just are not built to account for widespread car ownership.
I check the design of China cities, they are not walking friendly as Tokyo, since the buildings are far apart. If I look, they build the city almost like US cities, which is more car oriented. China cities also have many wide street, 3-4 lines. I always has a thought China is a car paradise, look at the wide street and expressway. It's wonderful! :thumb: I have a dream to drive a car in China expressway intersection especially in Chongqing. Or even cross country, crossing the mountain, the bridge in the mountain is amazing.

After reading your post, So most of China buildings and apartment don't have a plenty parking lot? I think China local government need to build more parking lot buildings in the district where there's not enough parking space. They can build it now, while there's still a lot of old buildings that can be demolished for parking lot towers. You should inform your local officials before it too late.


(Having said this I still plan to buy a car too!)
Off course, we all love car! :D
 

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Discussion Starter · #17 ·
ruru said:
It seems that for most Chinese, the badge on the back of the car matters most, followed by the size of the car (will probably change as the market becomes educated). Price of the car does not matter so much as it would in the USA. In the USA if you spent $40,000 on ANYTHING with a Toyota badge people would think you were an idiot. In China, people will think you are successful in business.

Different markets, different expectations.
I just hope that the car price in China will be similar to USA or even lower so that we will not be laughed by foreigners for driving toyotas and thinks its a prestige car just because its expensive only in China.
 

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Discussion Starter · #18 ·
NOBODY in the USA will laugh at Chinese who drive Toyotas. Trust me, Americans love Toyota. Especially the Toyota Camry, this is a VERY good car.

Americans don't understand why Chinese must pay so much for Toyotas! Toyota Corolla in China costs as much as Toyota Camry in the USA.
yea nobody will laugh at you driving a toyota, but they gonna laugh at you for paying a such price on a toyota when they can get it way cheaper.
 

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Discussion Starter · #20 ·
ruru said:
Can they get it way cheaper IN CHINA? 5 friends and I went out for dinner on Saturday night, all of us had full bellies and plenty of cold beer for about RMB180. I don't laugh at my pals back in the USA for having to pay over RMB1000 (plus tip!) for the same thing. They have no choice in the matter, going out to a sit-down restaurant for dinner/ drinks is going to cost them much more than it does here in China.
Well not, but cars are more looked as a status symbol than eating food IMO. When I goto a country to judge its progress I look at their buildings and cars, not the food I eat.
 
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