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Wealth sparks car kingdom
8/10/2004 8:53

Shanghai Daily News 

Owning a car is a dream for many across the country. Just ask Liu Min.

He recalls the day when he rode his bicycle to work in the sprawling capital.

Twice a day, the 36-year-old says he joined rivers of cyclists for his 35 minute commute between his office and home.

But things are changing in the "kingdom of bicycles."

"I've always dreamed of owning a car," says Liu, a China Post employee. "With a car it is more convenient to move around in Beijing or go for an excursion in the suburbs. I love to travel."

Liu's life has changed dramatically since February, when he bought a sport-utility vehicle for 85,000 yuan (US$10,240).

Liu earns 36,000 yuan per year and chose a domestic brand due to the low price.

The SUV saves him about 20 minutes on his home-office commute if traffic is good.

Liu's excitement about owning his first car is shared by a growing number of people. As affluence grows, more people are locking up their bicycles and jumping behind a steering wheel.

The national economy has doubled since 1990, boosting living standards, especially in major cities and along the east coast. A consumer society is emerging.

The auto boom is beginning as well. As the economy barrels forward, annual household incomes in major cities are reaching or exceeding US$4,000 - the figure regarded as a take-off point for private auto ownership on a massive scale.

More importantly, as Western and Asian auto giants hasten to squeeze into the world's fastest-growing car market, auto prices have dropped significantly in the last four years thanks to fierce competition.

Zhang Xiaoyu, vice-chairman of the China Machinery Industry Federation, says the nation's auto production has grown 15 percent annually on average in the last decade. This year China will produce at least 5 million motor vehicles, including about 2.5 million cars.

The National Bureau of Statistics says that at least 10 million cars are privately owned.

Beijing boasts the highest rate of private car ownership in the country - more than 1.28 million autos or 64 percent of the city's 2 million registered vehicles.

According to the Beijing Traffic Administration, the number of registered motor vehicles in Beijing has doubled in seven years between 1997 and 2003.

According to Zhang Jingli, deputy director of the traffic administration, of the 1.28 million privately owned vehicles in the city, more than 800,000 are cars. He says the number is increasing quickly.

"Since early 2003, each working day has seen the registration of 800 to 900 private cars," Zhang says.

People around the country are also spending hard earned cash on wheels.

According to Chen Hong, general manager of Shanghai GM, General Motor's joint venture in Shanghai, at least 100 million families are likely to buy cars in the coming 10 to 15 years - which would create the world's No. 1 auto market.