Second-hand car market accelerates

The second-hand market has never been significant in China, whether it be for houses or cars, as the country's army of new consumers favour the new and the shiny when coming to spend their hard-won yuan on major purchases.

There was a small market in second- hand cars among expatriates for many years, circulating their Beijing Jeeps and Honda Odysseys among each other, but generally the vogue was for new Buicks and VWs among the car-buying public.

However the market has expanded so much that a second-hand car market is starting to emerge, mostly in the last four years – basically the length of time since the boom really started to kick in nationwide.

Last year in China, used car sales rose 11 per cent to 4.8 million vehicles, while new car sales rose 7 per cent to 15.5 million. By some estimates, there will be six million used cars sold in China this year.

Marin Burela, president of Changan Ford, the US car maker's China joint venture, told the Associated Press at the Guangzhou car show that the industry expected used car sales of six million this year, about 10 million in 2016 and 20 million by 2020, which will bring it up to level with the sales of new cars.

Buying a second-hand car is still effectively a game of roulette, though. Number plates are scarce in cities like Shanghai and Beijing, so people tend to transfer them to their new cars, requiring those buying second-hand cars to go through the complicated auction process to get their hands on a licence plate.

Dealers don’t like the second-hand market, as they can make much more money selling new cars – about 90 per cent.

Many of the cars are sold in fields and outside warehouses in the suburbs and quality control can be problematic.

Some of the big car brands have instituted procedures for checking at their dealerships, but it mostly remains an inexact science.

There are bargains available, however. People like to joke how there is a busy market in Porsche Cayennes and Lamborghinis hastily sold by the children of corrupt officials, keen to avoid the scrutiny of the anti-graft crackdown.