With fewer people bidding on more plates than last month, the price for a license plate for a private car hit a one-year low at a monthly bid over the weekend.
The lowest winning price for a private auto plate plunged to 25,000 yuan (US$3,086) at Saturday's auction, the lowest winning bid since August last year. Last month's lowest winning bid was 37,900 yuan.
Plate prices have been rising for three straight months as a car buying spree led to an increase in bidders, who were eager to get plates for their cars.
The average winning price for plates stood at 35,905 yuan, down by 2,473 yuan from last month.
People have been complaining about the rise in prices in the past months as the price, which stayed somewhere below 35,000 yuan for almost a year, resurged in April as car sales picked up.
Although the government increased the number of plates available every month since April, prices kept rising as car sales rose.
Early this month, the city's transport authority, which controls the plate quotas, warned local vehicle dealers that they should not advise their customers to make unreasonable offers.
"Some dealers still advise their customers to offer higher bidding prices, so the average price stays high," said Yang Ping, a 33-year-old vehicle dealer.
"Sometimes, prices advised by dealers might be higher than the final winning price as dealers want to ensure their customers get a plate, but most of the time, we just advise them based on the previous prices and car sales," Yang said.
Car buyers often resort to the dealers for advice as dealers have a clear idea about car sales during the month and have a better understanding of how the bidding might go.
Some of the dealers might advise their customers to offer higher prices to ensure that they won't lose the bid, which annoyed the local government so much that it has suggested dealers are pushing up the plate prices.
The government released 6,829 plates this month, up from 6,326 last month. The number of bidders, however, dropped to 7,520 from 8,777 in July.
(Shanghai Daily August 22, 2005)
