Torsten Mller-Otvos, CEO of Rolls-Royce Motor Cars stands by a Pinnacle Travel Phantom unveiled by Rolls Royce in Beijing, ahead of the ‘Auto China 2014’ Beijing Automotive Exhibition. Boosted by the continuous growth in the number of millionaires in the country, the sales of luxury cars continues to soar in China. Despite the increasing obstacles such as a vast anti-corruption campaign and the authorities’ efforts to advocate austerity, the industry leaders, such as Rolls Royce, are developing their new models to win in this highly competitive market. — AFP photo
BEIJING: China’s desire for luxury cars remains undimmed by an economic slowdown and political austerity drive as the country’s growing band of wealthy motorists set their sights on high-end wheels.
In a lavish event off Tiananmen Square, ahead of the opening of the Beijing Auto Show, bejewelled models dressed in haute-couture graced the unveiling of Rolls-Royce’s Pinnacle Travel Phantom.
The new edition of its flagship luxury sedan, which comes in a two-tone dark red and silver, boasts intricate marquetry in its interior, customised to buyers’ requests, a reflection of the expensive tastes of the country’s elite.
Mainland China is already Rolls-Royce’s biggest market in terms of sales, representing 28 per cent of the company’s revenue.
Despite the slowing pace of overall economic growth in China, the future still looks bright for the luxury brand, says the company’s chief.
“If you compare to (Rolls-Royce) growth figures we saw here two or three years ago, big double-digit numbers… we see that growth is slowing down, but I am still optimistic about the Chinese market in the medium to long term,” chief executive officer (CEO) Torsten Muller-Otvos told AFP.
“The whole Chinese market has become a more mature car market and that was to be expected,” Muller-Otvos said.
Since becoming head of the Communist Party in November 2012 and China’s president in March last year, Xi Jinping has mounted an austerity campaign among top officials and a highly publicised crackdown on corruption, designed to rein in spending.
China’s business community has also suffered as growth figures stagnate – last month the country set an annual growth target of around 7.5 per cent, the lowest levels seen in nearly a quarter of a century after years of breakneck expansion.
“The economic slowdown, austerity campaign and crackdown on corruption have already created negative impact on the sales of superluxury vehicles,” said James Wu, auto expert at Ernst & Young.
“Bentley and Lamborghini reported (fewer) sales in China in 2013 year-on-year,” he said.
However, Wu said the “more affordable” luxury cars have outpaced the growth rate of the auto industry as a whole, with three German companies at the helm: BMW, Daimler (Mercedes) and Audi.
The popular trio dominates the high-end Chinese market and enjoyed sales increases of 20 per cent (BMW), 18 per cent (Daimler) and 21 per cent (Audi) last year.
Audi, the sector leader, sold nearly 492,000 cars in China – its biggest market – and will this year surpass half a million, according to Audi chairman Rupert Stadler. — AFP