Car Purchase Restrictions Easing in Some Cities

🚗 For many consumers like Xiao Zhang, who has been participating in the lottery for 12 years without success, the relaxation or even lifting of car purchase restrictions is a long-awaited wish. The policy has already provided a clear direction for new energy vehicles. "The recently issued 2024-2025 Energy Conservation and Carbon Reduction Action Plan (hereinafter referred to as the Plan) clearly proposes to gradually cancel the purchase restrictions of new energy vehicles in various places." said Professor Zeng Xin from the University of Science and Technology Beijing to the reporter of China Automobile News, replacing the previous policy's "adjust according to local conditions" with "gradual cancellation," clearly indicating the direction of the policy.

Multiple Cities Gradually Relax Purchase Restrictions

🏙️ The direction of relaxing vehicle purchase restrictions in restricted purchase cities has been repeatedly mentioned in policies by relevant national departments this year. Currently, cities such as Beijing, Shanghai, Guangzhou, Tianjin, Hangzhou, and Shenzhen have not completely lifted car purchase restrictions. To further implement the national and local deployment on restoring and expanding consumption, many regions have actively optimized policies to relax car purchase restrictions.

📅 On July 1st of this year, the "Guangzhou Passenger Car Quota Control Management Method" came into effect. It proposes that the quota for ordinary car incremental indicators is 80,000 per cycle, allocated on a monthly basis. Individuals who have participated in the incremental indicator lottery for more than 72 times can directly apply for an ordinary car incremental indicator without occupying the quota. The quota for energy-saving car incremental indicators and new energy car incremental indicators is unlimited. In each configuration cycle, 40,000 ordinary car incremental indicators are allocated by lottery, and 40,000 by bidding. The unit indicator accounts for 10% of the quota, and the individual indicator accounts for 90%. Energy-saving car incremental indicators and new energy car incremental indicators are directly allocated.

🌐 Shenzhen's "Shenzhen Action Plan to Promote the Exchange of Consumer Goods for the Old" released on May 27th proposed to cancel the social security restrictions for non-Shenzhen residents applying for new energy car incremental indicators; it also relaxed the conditions for individuals with only one car registered in Shenzhen to apply for hybrid car incremental indicators. That is, individuals with one Yue B license plate can apply to purchase another hybrid car. In April 2023, Shenzhen's "Notice on Adjusting the Application Conditions for New Energy Car Incremental Indicators" had already canceled the restrictions requiring continuous payment of basic medical insurance in the city for more than 24 months.

🏙️ Tianjin's optimized passenger car control policy measures implemented this year include 30,000 ordinary car indicators for carless families, 10,000 ordinary car indicators for "long-time unselected" applicants through a ladder lottery method. In addition, a special indicator for high-level talents has been set up, stipulating that Haihe Talents recognized by relevant departments in Tianjin, who have not registered a small passenger car in Tianjin, can apply for one indicator.

📜 Hangzhou issued the "Notice of the Hangzhou Municipal Transportation Bureau and other 6 departments on the Release of Several Policy Measures to Optimize the Other Indicators of Passenger Cars (Trial)" last year and implemented it. It clearly states that individuals who have been participating in the license plate lottery for a long time, talents, families with multiple children, and key enterprises can directly apply for passenger car indicators. The Hangzhou Control Office actively pays attention to and studies the implementation of the new policy last year, and will optimize the control policy in time according to the implementation effect.

Is a Full Opening Feasible?

🚦 For consumers in some restricted purchase cities, the lack of a small passenger car number plate index has become the biggest obstacle for them to enter the car consumption market, especially for the "long-time unselected" crowd with a strong desire to buy a car. "It's not that I don't want to buy a car, but I participate in the lottery every time, but I just can't win it," the relatively low winning rate of the lottery in restricted purchase cities is an undeniable fact. It is reported that Shenzhen's first personal lottery winning rate in 2024 is 0.248%, and the second period of personal lottery winning rate in 2024 is about 0.255%. The lottery results of the first small passenger car indicator (oil car indicator) in Beijing announced on June 26, 2024, show that more than 620,000 families and 2.59 million individuals applied for the lottery, but only 9,600 people can get a license plate. Therefore, relaxing or even opening up car purchase restrictions has always been a hot topic.

🚗 Feng Xingya, the general manager of GAC Group, proposed that many large cities in China have implemented car purchase restriction policies for many years, which objectively forms a demand suppression on the most purchasing power consumer market. In the current situation where the concept of environmental protection is gradually taking root in people's hearts, car consumption is becoming more rational, and the domestic demand is in urgent need of driving, optimizing the car purchase restriction policy and releasing some of the car purchase needs of big cities in a limited way is feasible.

🏢 Professor Li Ming, a professor and doctoral supervisor at the School of Automobile Engineering of Jilin University, said to the reporter of China Automobile News that the two main areas currently gradually relaxing purchase restrictions are cars and real estate, but the results are quite different. In 2023, the national new housing sales amounted to about 11.7 trillion yuan, a year-on-year decrease of 6.5%; the same period car sales amounted to about 10.1 trillion yuan, a year-on-year increase of 12%. Obviously, the growth momentum of car consumption is nearly double that of real estate growth. In the first half of this year, cars accounted for 1/10 of the total retail sales of social consumer goods, becoming a real leader. If the relevant cities can fully open up car purchase restrictions, it will not only further drive social consumption to a large extent, but also promote the growth of the automotive industry, thus making more contributions to economic and social development. At the same time, the traffic in these big cities is gradually advancing towards intelligence. If supported by advanced technologies such as big data and large models, and the level of urban intelligent traffic management is improved, coupled with the current restrictions, a high-level intelligent urban traffic model can be created.

📊 According to the latest data released by the Ministry of Public Security, as of the first half of 2024, there are 20 cities with a car ownership of 3-5 million, among which Shenzhen, Hangzhou, Guangzhou, and Tianjin are restricted; cities with a car ownership of 5-6 million are Shanghai, Suzhou, and Zhengzhou, among which Shanghai is restricted; and cities with more than 6 million are Chengdu, Beijing, and Chongqing, among which Beijing is restricted.

🚦 At present, it is not likely for mega-cities like Shanghai and Beijing to fully open up car purchase restrictions all at once. Zeng Xin believes that at this stage, under the condition that intelligent traffic management has not reached a certain level, even with the current restrictions, the traffic congestion index in cities like Shanghai and Beijing is still high, and fully opening up car purchase restrictions will lead to more difficult road traffic. According to public data, although Chengdu's car ownership has exceeded that of Beijing, the permanent population and administrative region area of the two cities are relatively close, but due to natural geography, urban construction, road distribution and other factors, 90% of Chengdu's population lives on 75% of the land area, while Beijing's more than 90% of the population lives on 55% of the land area; Chengdu's road network density is 8.6 kilometers per square kilometer, while Beijing is only 5.9 kilometers per square kilometer. Therefore, even with similar car ownership, the difficulty of solving traffic congestion in Beijing is greater than that in Chengdu. But he also believes that other restricted areas can gradually cancel car purchase restrictions except for Beijing and Shanghai.

📘 Cui Dongshu, Secretary-General of the Passenger Car Market Information Joint