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Carmakers encouraged to enter second-hand business

Xinhua | Updated: 2013-07-15 09:35

BEIJING - China is encouraging car manufacturers to enter the second-hand auto market to cash in on the growing sector and boost China's auto consumption.

Deng Li, deputy director of the Market System Development Department of the Ministry of Commerce (MOC), said China is working to speed up the development of the second-hand auto market.

Deng said China will encourage automakers to utilize their existing dealership network to expand the second-hand auto trading business.

A lack of quality assurance is among the main reasons preventing Chinese consumers from purchasing second-hand vehicles, experts said.

MOC figures showed that second-hand vehicle sales stood at 7.94 million units last year, growing faster than new vehicle sales but accounting for only 40 percent of total sales.

Deng said that in well-established markets, used vehicle sales can be up to three times that of new vehicle sales.

Experts said the convenience and warranties offered by automakers will make consumers more comfortable with choosing a second-hand car.

Chinese automaker FAW Group is making its own foray into the used car business. It is working on a second-hand vehicle project that includes several of its models. The company will provide vehicle inspection, price evaluation and car transaction services as part of the project.

China also intends to build large regional second-hand vehicle markets and an online national platform for second-hand vehicle bidding.

The country will reduce transaction costs for second-hand vehicles, Deng said.

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