Car lottery scheme aids non-local buyers

Beijing auto dealers are colluding with local car plate lottery winners to charge non-local car buyers who are barred from purchasing a vehicle in the city without winning the lottery.

The scheme has become popular as certain car models can be bought at cheaper prices in Beijing than in other provinces and cities.

A manager, surnamed Yang, from Beijing Hengyi Zhongbao Automobile Company in Fengtai district, said that out-of-town buyers will pay around 30,000 yuan ($4,710) to "rent" a person's registration, usually a Beijinger who already owns a car and does not need another.

"Without winning the car plate lottery, non-local car buyers are not allowed to buy Volkswagen vehicles here, which are much cheaper than in other cities," said Yang.

For example, certain models sell in Beijing for around 58,000 yuan less, he said.

But after purchasing the car, buyers will then give back the registration, and re-register the vehicle in their hometown.

Half of the payment goes to the original holder of the registration, and the other half is to pay for all the fees and paperwork. Once the registration has been handed back, it can be re-used multiple times, said Yang, but only within six months, at which point the registration expires.

Beijing started issuing car license plates via a lottery system from January 2011, aiming to ease traffic congestion.

"With so many unlucky applicants waiting, there are schemes to get around the system; doesn't it mean the [lottery] regulation has inherent flaws?" said a local applicant, surnamed Yu.

The car lottery registration office could not be reached Tuesday, but an official, surnamed Tian, from the office told the Beijing Times Monday that the policy states only the winner can buy a car under the registration, so this collusion between auto sales companies and buyers cannot really be blamed on the regulation itself.

Beijing car registration lottery office announced the odds of winning are at 1:46 for the latest round in July, with over 930,000 applicants in the pool.