That's not to say that the luxury car market in China hasn't suffered some pangs from the economic slowdown. Sales of Mercedes-Benz, BMW and Audi slowed from their average 30-percent growth in the second half of last year as even the wealthy curbed their spending, especially in Guangzhou and Shenzhen in Guangdong Province where many factories have been forced to close.
The luxury car market also has to contend with plans to levy higher taxes on cars with large engines, which will increase their purchase price.
"Without favorable government policies, it's still questionable whether the luxury car market will rebound to its former high-growth levels in the absence of improvement in the global economy," said Lin Huaibing, an analyst at Global Insight.
Long-term prospects
"We are seeing less profit because consumers are demanding higher discounts," Fire Fung, director of Rolls-Royce Motor Cars Shanghai. "We have held back our plans to open new dealerships in the East China region this year to ensure existing dealers would be able to make money under the current circumstances."
Longer-term prospects, however, look good.
China's robust economy has created millionaires at a fast pace.
The nation is home to 51,000 people who are worth more than 100 million yuan (US$14.7 million), according to a study published by Hurun Report, a business magazine best known for its "China Rich List." One in every 1,700 people on the Chinese mainland has more than 10 million yuan in personal assets, according to the magazine.
Encouraging sales
"The economic situation doesn't mean all rich people are in dire straits," said Xu Qun, publisher and editor of Car & Driver and Mr Modern.
"But they have become more selective when buying luxury vehicles. They do more comparison shopping. They want to know everything about the car, and they want a test drive."
At the auto show, Bentley, the premier affiliate of Volkswagen AG, said it sold 15 vehicles including all models on display.
Company officials from Porsche, Ferrari, Maserati and Maybach declined to give sales figures chalked up at the auto show, but most of them said sales exceeded expectations.
Lamborghini said it received more than 10 orders for its models, including one for its LP670SV sports car that costs more than 7.5 million yuan, even though buyers will have to wait a year for delivery. About 18 Rolls-Royces also were sold, including the RR4 luxury sedan that will hit the market later this year.
TNS China's Paur said the country's nouveaux rich likes to flaunt their wealth. "Luxury car ownership is a good opportunity to express one's affluence, and highly inspirational brands like Ferrari, Lamborghini, Porsche and Rolls Royce are benefiting from that."
"Chinese consumers are also very fond of new products and the latest technologies," he added.
Luxury car makers revving up business in China have had to adapt to Chinese tastes in vehicles.
BMW's and Audi's longer wheelbase luxury sedans are specially designed for the Chinese market because consumers think bigger is better, particular for business use.
(Shanghai Daily May 4, 2009)
