Beijing's License Lottery: Unlucky Winners and Expat Hostages

The recent car regulations in Beijing have resulted in some interesting fallout that just proves bikes are best. It has been lottery overload with winners facing a ticking clock before their luck literally runs out. And expats are facing their own dilemma, outlined by Agenda.

According to a Xinhua article, chances in the monthly draw for one of 17,600 plates is 1 in 23, with nearly 400,000 applicants having applied in March.

Earlier in the week, China Daily reported that people are entering the lottery without any certain plans to buy a car. Very few of the winners from the first two lotteries have actually bought cars, some because they don’t want or can’t afford a car presently, and others are bemoaning the lack of deals in the car market at the moment.

For those that have won they have six months to purchase a car before their prize is put back into the pool. Reports suggest that these unused plates will be added to the starting 17,600 licenses for each month.

And more from Agenda:

Drivers beware! If the mean streets of Beijing were not enough reason to discourage you from hitting the road, fate might now make that call for you. Starting in 2011 Beijing has issued new regulations, and aspiring drivers now have to win a lottery in able to purchase a car. That, or spend a lot of money. Last night Agenda got a hot tip from Bruce McNalty, Learning Support Teacher at the Western Academy of Beijing. Here’s the scoop so far:

We have a great car to sell, and lots of interested buyers but they are unable to buy our car. We are finding it next to impossible to find a buyer who has “won a plate” from the lottery. Yet we must sell our car before we leave Beijing in three months or we can’t get our shipping released….

Check out the full article on Agenda’s website here.

Comments

As soon as I heard the news about the new regulations, back on Dec.23rd, I rushed to the BYD dealership and bought a car. 3 months later, I got my license plate. Why did it take so long? They were unclear about Visa regulations. At first they said my 12 month 旅游签证was enough. Then they said I need a 6 month visa, after I did that, they said it was short 5 days. Finally in mid March I got a 7 month visa, then paid my 140 rmb for my license plate.

祝你每天开心。

大洋
美国人 演员,主持人,作家,歌手
davidwilliams64@126.com

This issue is overblown - no one is being taken "hostage". Just sell the car to a used car dealer. Sure, in this market you're going to take a hit, but that is just supply/demand at work folks.

The issue is massive. I believe that the guy quoted in the article did take it to a used car dealer-he was offered 1/5 of the price he would have been easily able to get before the law change. Now maybe you can kiss away 80% of the potential value of your car without it hurting, but most can't.

And their car is quite new-what if it's an older Cherokee-which many expats have here. The second hand dealers won't even take them. What will you do then?

I do sympathize with the guy if what was stated in the article is true.

That said, I feel many expats tend to take things for granted here and expect the same level of "fair treatment" that they would in their home countries.

In this case, a change in local auto licensing regulations had a rather large effect on the auto marketplace (both new and used). Our friend here may now have Jeep that is close to worthless on the local used market, but to me the bigger issue is that there are now hundreds of auto salespeople in Beijing who are effectively now out of a job. I visited a Toyota dealership recently and last month they only sold 6 cars the entire month - they were selling 6 cars/day prior to the new regulations.

But that's just how things work here - rules can change in a flash, though usually they will get "leaked" ahead of time (hence the massive number of new car sales in Beijing last December).

It's not just this - recently there were some rather strict regulations enacted for buying properties here in Beijing - even I was surprised. And in a few years when the RMB appreciation accelerates or some other financial event occurs and causes foreign investment to start pulling out of China, you can bet there will be regulations put in place then to stabilize the economy. Such as limiting the amount of RMB you can convert and transfer out of the country, or even by making it more difficult for foreigners to sell their apartments. This may sound extreme, but trust me it could happen.

In anycase, expats who can afford to buy a car here should carefully consider the risks before doing so. I'm not just referring to the problem exposed here, actually as a driver in China the thing I worry about most is hitting a pedestrian. The laws here heavily favour the victim, it doesn't matter if you have insurance - you will pay. I've heard some scary stories involving foreigners getting into accidents. In fact, there was a thread on the forums here about 2 years ago, I was curious to know how it got resolved but the thread seems to have gotten removed.