(Yicai Global) March 24 -- Beijing is considering to relax its strict quota on new vehicles to help revive an auto market further crippled by the novel coronavirus epidemic.
China's capital may ease the quota by at least 100,000 cars in the first half, doubling its current limit, the commerce ministry said today. The increased supply would go to residents who do not already own a vehicle and those on a waiting list for new energy vehicle license plates, it added.
This year's new passenger car quota was 100,000, the same as last year, with 38,200 plates for ordinary cars and 54,200 for NEVs, according to last month's plan.
China's auto sector has been in trouble for two years, but sales plunged by a record 80 percent last month as buyers stayed home, assembly plants idled and dealerships shut amid the coronavirus epidemic.
Beijing set up the car cap in 2011 to limit the number of new vehicles being added to its roads in an attempt to ease traffic congestion and air pollution. The new measure is aimed at boosting demand by CNY20 billion (USD2.8 billion) this year, around 12 percent of last year's sales.
The city is also looking at offering time-limited subsidies for buyers who replace old vehicles that have excessive emissions with new ones. It is also considering excluding from the license plate quota passenger vehicles that run only in the city's suburbs.
Ordinary car owners must win a lottery to get a Beijing-registered license plate and NEV-owners are put on a waiting list. Demand is so high that new NEV owners may wait up to nine years to get a permit, online news portal The Paper reported last month.
Autos accounted for 13.8 percent of retail sales of consumer goods last year, the biggest commodity group, according to the ministry. That was still an 8 percent drop from 2018.
Editor: Kim Taylor