Deciphering Number Plates: China

Deciphering Number Plates: China

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Curious what rules govern the registration-number system in the world’s most populous country? Why the people in Shanghai often pay more for their registration number than for the car itself? Or how the number-plate lottery in Beijing works? Find out in this article!

25. 6. 2019

In this instalment of our Deciphering Number Plates series, we visit the People’s Republic of China, the world’s most populous country. The UN estimates that China currently has a population of 1.42 billion. As the economy grows and living standards improve, demand for cars is also ballooning. Even so, the Chinese registration-number system manages with just seven characters, the same number, for instance, as the Czech Republic. Wondering how that’s possible? This is a little misleading because the first character is Chinese and may take any of more than 30 different forms. The main reason, however, lies elsewhere: the limit on the number of plates issued in the largest cities.

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In 2004, approximately two million cars were registered in both Beijing and Shanghai. Yet by 2010 there were 4.8 million cars in Beijing and “just” 3.1 million in Shanghai. This is because, ever since 1994, Shanghai – along the lines of Singapore – has been restricting the number of plates available and issues them through a bidding system. With demand outstripping supply many times over, plate prices are spiralling. To give you some idea, at the beginning of 2018 the 11,000 plates on offer attracted more than 220,000 bids and the auction price averaged almost USD 14,000, which is more than certain locally made cars cost.

Beijing also caps the number of plates issued, but waited until 2011 to launch this policy. This restriction was primarily introduced in response to the overcrowded roads and the suffocating smog that, as late as 2013, was bedevilling the city for more than half the days of the year. Unlike Shanghai, however, Beijing has opted to hold a public lottery every two months. Under this system, plates in Beijing are more affordable than in Shanghai. However, the likelihood of obtaining one is decreasing every year because rocketing numbers of applicants are chasing an available pool of plates that is diminishing as each year goes by. While different sources cite different numbers, The Economist drew directly on government statistics to discover that, at the beginning of 2018, any private individual wanting to own a car with an internal combustion engine had a 0.2% probability of winning the number-plate lottery (in February, 6,460 plates were made available to approximately 2.8 million applicants, averaging one plate per almost 450 hopefuls).

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The situation is slightly better for electrified cars (NEVs - new energy vehicles), which primarily include plug-in hybrids, battery electric vehicles (BEVs) and hydrogen fuel cell electric vehicles (FCEVs). Special plates are issued for NEVs, with 54,000 being made available for distribution among approximately 390,000 private applicants in 2019 (businesses are a separate group and have been allotted 6,000 plates). Unlike the situation with ICE vehicles, these plates are issued on a first-come, first-served basis. There is currently a waiting time of about eight years for those wanting a number plate for an electrified car.

Some cities have gone down a third route that combines a lottery with an auction. In practice, this means that some plates are auctioned and the rest are put in a draw. Guangzhou pioneered this method, which has since spread to other cities.

In all of these cities, anyone wishing to buy a car must first be in possession of the plates. Since number plates are transferable (and lifelong), this has combined with the circumstances above to create a black market in number plates. Some people rent out their plates (illegally). Sham for-cash marriages are another phenomenon, as married couples are permitted to transfer number plates between them.

And what do Chinese plates actually look like? The current format was first introduced back in 1992, and was updated in 2007. Passenger-car plates comprise white lettering – usually seven characters – on a light-blue background. As we have already noted, the first character is Chinese and denotes one of the provinces. It is followed by a Latin letter to indicate one of the areas within the province. Alternatively, some provinces (such as Beijing) use a special letter here to single out, for example, taxis, police cars, and the employees of certain state institutions. There are then five characters making up the vehicle’s unique identifier. Initially, only numbers were used, but in some provinces all of the numeric combinations were used up, so letters were introduced alongside numbers. The combination of characters is randomly generated by computer.

In 2002, a new plate personalisation system was trialled in some cities, but it was very short-lived. Customised plates could have one of three forms for their unique vehicle identifier (the character for the province and the letter for the sub-region could not be changed): DDD-DDD, DDD-LLL or LLL-DDD (with D and L standing for digit and letter, respectively). Though some combinations were banned (e.g. “CHN” for China), many others – such as PRC, USA and SEX – were permitted. Indeed, such combinations made their way on to the streets and some of them caused uproar among the authorities (for example, USA-911, which may well betray a love of America and the iconic Porsche model, but could just as well refer to the events of September 2001). This system was soon abolished and replaced by the original one from 1992.

As already mentioned, NEVs use a specially formatted number plate featuring black lettering on a green background. The vehicle identifier is either D or F – the letter D denotes a battery electric vehicle, while the F symbolises other NEVs, especially plug-in hybrids and FCEVs.

Hong Kong and Macao, as special administrative regions, stand apart in the Chinese number-plate system. Both of them have their own number-plate system, reflecting their colonial past (Hong Kong belonged to the UK and Macao to Portugal). The citizens of these provinces who wish to drive their car to mainland China must apply for a Chinese plate. Likewise, when citizens of the Chinese mainland want to visit Hong Kong or Macao, they have to apply for a local plate. The Chinese number plates of cars from Hong Kong and Macao also have their own specific format – white lettering on a black background.



IMPORTER QUESTIONS

Answered by: Jiyong Wen,
ŠKODA China press officer


How would you sum up ŠKODA’s historical presence on the Chinese market?

ŠKODA has been known in China for many years now. The brand’s first vehicle, the POPULAR, started to be imported into China in 1935. The modern history of ŠKODA’s success dates back to 2007, when a joint-venture was formed with SAIC Volkswagen. That was the year in which production of the ŠKODA OCTAVIA was launched in China. Since then, more than 2.6 million ŠKODAs have been sold in China.

China has been the largest single market for ŠKODA since 2010 and accounts for a large part of its global sales. In 2018 alone, ŠKODA delivered 341,000 vehicles here.

How do the Chinese view the ŠKODA brand today?

China is now the world’s largest automotive market, and arguably also has a concentration of competition not found anywhere else. Apart from virtually every leading world carmaker, the market is also awash with dozens of domestic brands, whose strength and position is growing in leaps and bounds every year. Having said that, ŠKODA brand awareness among Chinese customers is relatively good, though we still have a lot of work to do here. Since entering the Chinese market 12 years ago, ŠKODA has also been trying to supply Chinese customers with cars that not only give them a proper driving experience, but also make their lives more pleasant with numerous Simply Clever features.

China plays a central role in ŠKODA’s growth strategy. The carmaker is ready to start implementing the largest five-year investment plan in its history here, which is expected to exceed 15 billion Chinese yuan. ŠKODA hopes that, with the help of its partners, it will strengthen its position on the Chinese market. It wants to achieve this primarily by developing new products and technologies, moving forward with New Energy Vehicles (NEVs), and engaging in marketing support for the brand.

Which models sell best on the Chinese market and how do they fare against competitors in their class?

ŠKODA currently has 467 sales offices throughout China. The key model for the Chinese market is the OCTAVIA. When this model started to be made in China in 2007, it was the first time in its modern history that ŠKODA had launched completely local production of any model. From its inception, the OCTAVIA was a top-seller. In 2017, the OCTAVIA COMBI was introduced and was an immediate hit. Of the 6.5 million OCTAVIAs made, counting from the first cars to roll off the production line precisely 60 years ago, over 1.3 million have been manufactured in China.

The supply of SUVs is also spiralling. In 2018, ŠKODA sold more than 117,700 SUVs, a 189% increase on 2017. The driving force among SUVs is the KODIAQ, with 51,230 units sold.

Is there anything specific to the Chinese market?

The successful SUV offensive has been a central plank of the ŠKODA brand’s growth on the Chinese market. Since 2017, ŠKODA has offered four SUVs on this market: the Chinese version of the KAMIQ, the KAROQ, the KODIAQ and the KODIAQ GT. The first model to be introduced in our SUV campaign was the KODIAQ. Launched in April 2017, it guided the brand into a new segment on this market. Then, two models designed exclusively for the Chinese market were launched. The Chinese KAMIQ premièred at the Beijing Motor Show in 2018, while the KODIAQ GT was introduced in Guangzhou in November of the same year. The KODIAQ GT is the first ŠKODA SUV coupé to offer a lusty driving experience. It appeals to new, lifestyle-oriented customers. Interestingly, China is the only market where four ŠKODA SUVs are available.

In China, ŠKODA actively promotes cycling and ice-hockey. Since 2017, it has been popularising the Tour de France here. In 2018, it sponsored the Tour de France ŠKODA Shanghai Critérium. As the 2022 Beijing Winter Olympics approach, ŠKODA plans to promote ice-hockey and other winter sports further in China.

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