XINHUA, China (January 4th) - Chinese consumers are buying cars at an breakneck speed, spurred on by new government policies that allow banks to lend on vehicles and, for some of them, by a desire to impress the neighbours. More than 3.91 million of the 4 million motor vehicles manufactured between January and November 2003 were sold.
"China's auto demand is expected to rise to 10 million by 2010, second only to North America," said Zhang Xiaoqiang, vice-minister in charge of the State Development and Reform Commission in mid-December.
Rising income accounts for only part of the buying frenzy. A car, like a laptop computer and a house, has long been regarded as a coveted emblem of a middle-class life.
The Chinese Government's policy to encourage individuals to buy cars or houses in installments through bank credits has boosted consumption of luxury items. The concept of credit is relatively new in China.