Prices Of Luxury Cars Collapse In China
The Chinese stock market is way down. Real estate speculation had reached its zenith a while ago, and prices are on a downward trajectory. So are prices of luxury cars. Now is the time to get great deals on a BMW, or a “Benz,” as they call a Mercedes in China. Dealers are killing each other with discounts to move the high-end metal. Says China Daily:
“Average prices of Daimler AG’s basic 2012 Mercedes-Benz C200 sedan at Chinese dealerships were 16 percent below the manufacturer’s recommended price last month, compared with 14 percent in October and 3.4 percent in July, when the model became available, according to data from China Auto Market. BMW dealers sold the 2012 320i sedan 11 percent below the suggested price, more than triple the initial discount for the 2011 model.”
Daimler, BMW and Volkswagen had record sales and record earnings this year, mostly driven by healthy exports to and sales in China. This could offset a flat European market, which shows signs of deterioration.
Last month, Audi posted a 69 percent jump in China deliveries to 29,861 units. BMW had a 9.8 percent increase in sales in the country, while Mercedes-Benz increased deliveries by 24 percent. Expansion however never goes on forever.
The benchmark Shanghai Composite Index has declined 22 percent this year and is trading at the lowest since March 2009. Home prices fell in 33 of 70 cities monitored by the government in October.
German makers are looking with worried faces to China. Big capacity expansions are underway, and if increased supply collides with collapsing demand, this year’s high-flyers could soon find themselves flat on their worried faces.