Car plate prices in steep decline

By Jin Jing  |   2008-11-16  |     NEWSPAPER EDITION

PRICES for car registration plates in Shanghai have declined sharply, hitting an eight-month low.

The average price for a car plate dropped 8,873 yuan (US$1,305) to 24,351 yuan (US$3,581) in comparison to October's prices at yesterday's monthly auction, according to Shanghai International Commodity Auction Company.

The lowest winning bid fell to 21,800 yuan, a drop of nearly 33 percent, or 10,800 yuan, from a month earlier. Prices are the lowest since March this year.

Analysts said consumer enthusiasm for buying cars was fading as the global financial crisis prompted more caution on big ticket item spending like vehicles. As a result, the demand for car plates has also weakened.

The municipal government put 5,500 plates under the hammer this month, 500 more than in October. The auction attracted 10,170 bidders, 14 percent less than in October and only one-third of the peak record in March.

A netizen who joined in the bidding said in an online posting: "I had expected the price decline for this month, but I hadn't expected the price would nose dive that much."

Before the auction, the average selling price for a plate on the second hand market, which sets the benchmark for the new plate price, was around 32,000 yuan.

It is also under the lowest price for October and more sellers further cut their price to 30,000 yuan to entice buyers.

Vehicle sales in China posted year-on-year declines in August and September for the first time in three years.

Car makers offered extra discounts during September and October but sales remained flat.