Luxury car frenzy has spread to Chinese consumers. Even as the number of millionaires in China grew by 31 percent to over 1.1 million last year, car clubs have begun to proliferate across the country. Providing a boost to car sales within this booming economy is the average age of China’s millionaires – at 39, they are a good 15 years younger than their counterparts in Europe and the United States.
Two years ago, there were no car clubs in this Asian country. But the car culture is growing quickly. Younger Chinese millionaires think less about saving and more about spending, which bodes well for the luxury car industry here. The growing economy, soaring real estate prices and a stronger yuan has catapulted many Chinese households into the millionaire bracket. Consultants Bain & Co. have predicted that deliveries of luxury cars in China could rise by a whopping 35 percent this year.
So it should be no wonder that car clubs are gaining in popularity. Zhang Kuan, a Lamborghini SpA LP640 owner, started the country’s first car club, the Beijing Sports Car Club in 2009. The Beijing Club has grown to 250 members. Women form 10 percent of their membership. To give you an indication of the kind of luxury involved, it might interest you to know that in this exclusive car club, a $220,000 Porsche SE 911 is considered an entry-level car. Meanwhile, at the Yunan Sports Car Club, it is all about connecting and understanding the mechanics of these high-end vehicles.
Unlike in car clubs of Europe and American, clubs in China are formed according to location rather than brand. In Europe, car clubs often involve visits to the garage of some car collector to marvel at his/her collection. It is rather like going to a museum. However, in China, there is less of looking and more of driving. There is a more hands-on approach.
China’s wealthy classes are located in centers like Beijing, Shanghai and Guangdong and luxury car manufacturers are going all out to tap this market. For instance, Volkswagen AG’s Bugatti entered the market in 2008. The car brand has since increased its local presence by hosting car shows in Beijing and Shanghai and arranging for test drives. Aston Martin recently sold five units of its $6 million One-77 (the world’s costliest car by sticker price) even before the models made it to the showroom. Only 77 models of the same are sold across the world.
The fast-growing economy has presented the Chinese with a chance to earn a fortune quickly. This bodes well for carmakers from around the world. David Hu, the Bugatti sales manager at the brand’s official dealership in Beijing, admitted, “Entering China is a natural step.” Meanwhile, Matthew Bennett, the Asia Pacific director at Aston Martin Lagonda Ltd., expects that overall sales will double in 2011. Aston Martin had sold 100 cars in China last year.
Meanwhile, Porsche is looking to expand its Chinese presence in a big way. Last year, there was a 63 percent rise in Porsche deliveries across China. This year, Porsche is targeting sales of over 20,000 cars. China looks set to become Lamborghini’s biggest market as well.
Thus, the future looks bright for the luxury car market in China. And car clubs can look to prosper as well.
Via: Bloomberg
