Luxury carmakers see golden age in China

One of Rolls Royce boss Torsten Muller-Otvos' most memorable auto show moments came last year in Beijing when a man walked through the crowd to the carmaker's stand and set down a suitcase.

"Millions of renminbi," the man said of the suitcase's contents, referring to the Chinese currency.

"Really, that was amazing. He bought a Phantom," Muller-Otvos said.

The Rolls Royce chief executive told AFP no cash buyers had come forward yet at the ongoing Shanghai auto show, but the exhibition has provided further proof for luxury carmakers that their future is in China.

Sales of luxury cars are booming, reflecting the explosion of wealth in the world's most populous country, which has 115 billionaires according to Forbes magazine's 2011 list - second only to the United States.

As soon as Muller-Otvos finished unveiling the new Ghost with an extended wheel base on Tuesday - the first time Rolls Royce has premiered a new model in Asia - the stage was swamped.

Using connections to enter the show on the media preview day, millionaires bought two Rolls Royce Phantoms, which start at nine million yuan ($1.3 million) and four of the new Ghosts, starting at 5.1 million yuan.

The price tags included China's hefty 145 percent tax on imported luxury cars.

"Normally, this does not happen. Not on the first press day," Muller-Otvos said.

Rolls Royce saw its China sales rise 600 percent last year and Muller-Otvos said he expects to see solid double-digit growth in 2011. China passed Britain last year as Rolls' number two market after the United States.

China's luxury car sales are expected to rise to more than 909,900 units this year, up from about 727,200 last year, according to forecasts by IHS Automotive. And that number could to climb to 1.6 million in 2015, it added.

The number of individuals in China worth at least 10 million yuan ($1.5 million), rose by 9.7 percent in the past year to 960,000, according to a report published last week by the Hurun Report, Shanghai-based wealth trackers.

This is a source of political tension in China, where there is rising public dissatisfaction with a widening wealth gap. The government has vowed to pursue more equitable growth in the future.

But carmakers' ambitions are fuelled by Chinese growth rates that continue to be the envy of the world - the world's second-largest economy grew 10.3 percent in 2010 as other major economies limped out of the global downturn.

"There are more cities with millionaires in China now than in Europe," Matthew Bennett, the Asia-Pacific director for British luxury car maker Aston Martin told AFP.

Aston Martin caused a buzz in Shanghai by selling one of its super-luxury One-77s for 47 million yuan. The company will make only 77 of the cars and five were set aside to sell in China.

Prices for the One-77 start at 38 million yuan in China, including taxes, and are higher for add-ons such as solid-gold interior features, Bennett said.

"We don't like to say it's the most expensive car in the show, but we are pretty confident it will be," he added.

Asia is the fastest-growing region for Aston Martin, currently accounting for 10 percent of its sales. China overtook Japan last year to become its top market in the region with more than 100 cars sold.

Bennett said China sales should double in 2011.

"We are very, very excited about the potential in China," he said.

Italy's Lamborghini said it expects China to become its number one market this year as sales accelerate at turbo speeds.

Orders from China are coming in faster than Lamborghini can make cars and customers at the Shanghai auto show were being told they would have to wait until next year for delivery, China Business News reported.

Luxury carmakers believe this could be just the start of a golden age for them in China.

"There's still a lot of growth potential," Rolls Royce's Muller-Otvos said. "There's still a lot of new millionaires to come into the market."

jqf-dd/dma/ft

 

Voices
There will be a chance to bid for a rare example of the SAS Diary, collated by a former member of the regiment in the aftermath of World War II but only published – in a limited run of just 5,000 – in 2011
charity appealTime is running out to secure your favourite lot as our auction closes at 2pm today
News
Elton John and David Furnish exchange marriage vows
peopleSinger posts pictures of nuptials throughout the day
News
File: James Woods attends the 52nd New York Film Festival at Walter Reade Theater on September 27, 2014
peopleActor was tweeting in wake of NYPD police shooting
Sport
Martin Skrtel heads in the dramatic equaliser
SPORTLiverpool vs Arsenal match report: Bandaged Martin Skrtel heads home in the 97th-minute
PROMOTED VIDEO
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs General

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45,000 : SThree: Recruitment is a sales role ...

    Recruitment Genius: Telesales & Customer Service Executives - Outbound & Inbound

    £7 - £9 per hour: Recruitment Genius: Are you outgoing? Do you want to work in...

    Recruitment Genius: National Account Manager / Key Account Sales

    £30000 - £35000 per annum: Recruitment Genius: An opportunity has arisen for a...

    Day In a Page

    Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

    Clocks, rifles, swords, frogmen’s uniforms

    Surrounded by high-rise flats is a little house filled with Lebanon’s history
    Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

    Four months after the bombardment, Gaza’s wounds are yet to heal

    Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
    Gastric surgery: Is it really the answer to the UK's obesity epidemic?

    Is gastric surgery really the answer to the UK's obesity epidemic?

    Critics argue that it’s crazy to operate on healthy people just to stop them eating
    Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

    Homeless Veterans appeal: Christmas charity auction

    Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
    Pantomime rings the changes to welcome autistic theatre-goers

    Autism-friendly theatre

    Pantomime leads the pack in quest to welcome all
    The week Hollywood got scared and had to grow up a bit

    The week Hollywood got scared and had to grow up a bit

    Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
    From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

    Panto dames: before and after

    From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
    Thirties murder mystery novel is surprise runaway Christmas hit

    Thirties murder mystery novel is surprise runaway Christmas hit

    Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
    Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

    Anne-Marie Huby: 'Charities deserve the best'

    Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
    The botanist who hunts for giant trees at Kew Gardens

    The man who hunts giants

    A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there
    The 12 ways of Christmas: Spare a thought for those who will be working to keep others safe during the festive season

    The 12 ways of Christmas

    We speak to a dozen people who will be working to keep others safe, happy and healthy over the holidays
    Birdwatching men have a lot in common with their feathered friends, new study shows

    The male exhibits strange behaviour

    A new study shows that birdwatching men have a lot in common with their feathered friends...
    Diaries of Evelyn Waugh, Virginia Woolf and Noël Coward reveal how they coped with the December blues

    Famous diaries: Christmas week in history

    Noël Coward parties into the night, Alan Clark bemoans the cost of servants, Evelyn Waugh ponders his drinking…
    From noble to narky, the fall of the open letter

    From noble to narky, the fall of the open letter

    The great tradition of St Paul and Zola reached its nadir with a hungry worker's rant to Russell Brand, says DJ Taylor
    A Christmas ghost story by Alison Moore: A prodigal daughter has a breakthrough

    A Christmas ghost story by Alison Moore

    The story was published earlier this month in 'Poor Souls' Light: Seven Curious Tales'