Excessive Spending on Luxury Cars Continues in China Despite State Council Ban

Chinese state officials persist in using public funds to purchase high-end imported vehicles, defying the government's ban on such expenditures. The practice has seen a significant increase in the first five months of 1994, with a staggering 14.5 billion yuan ($1.7 billion) allocated for the purchase of luxury cars. This amount is sufficient to establish 12 luxury car plants in China or triple the total investment in the Chinese car industry since the Communist Party's rise to power in 1949.

Key Takeaways:

• Public purchase of top-of-the-range limousines in the first five months of 1994 reached 14.5 billion yuan ($1.7 billion), exceeding last year's import budget.
• The State Council's ban on importing foreign cars on public funds has failed to curb excessive spending, with public car purchases increasing by 187 percent over the same period last year.
• A province in northeast China spent one-tenth of its annual revenue on 4,314 luxury cars in the first five months of 1994, breaking records for car expenditure.
• The government's own regulations, such as the regulations promulgated by the southern Chinese city of Canton (Guangzhou), ordering officials to sell luxury cars worth more than $57,000 and buy Chinese cars instead, have been ineffective in addressing the issue.
• Foreign companies, including Rolls Royce, General Motors, and Mercedes Benz, continue to capitalize on China's luxury car market, with Rolls Royce launching a high-profile publicity campaign and both General Motors and Mercedes Benz expanding their presence in the country.

Statistics:

• 14.5 billion yuan ($1.7 billion) allocated for public purchase of luxury cars in the first five months of 1994
• 187 percent increase in public car purchases over the same period last year
• Estimated cost of building 12 luxury car plants in China: 14.5 billion yuan ($1.7 billion)
• Total investment in the Chinese car industry since the Communist Party's rise to power in 1949: approximately 4.85 billion yuan ($569 million)

Sources:

• China Youth News