Why very poor families can still afford a car in China

[Kai Liu]

All prices from dealer (buying from owner will be even cheaper):

 

[Globenim]

Thats pretty normal in most developed countries by their own standard of "very poor families".

Still good.

 

[Nowshera]

That's incorrect. The market value of a car is not always proprtionate to the worth of a car. I'll give you an example of the UK. In the UK a luxury vehicle like a Mercedes S-Class brand new will cost £60,000 new. The same car when 3 years old is approximately £25,000. That car is still better than 99% of cars in the world but has lost over 50% of it's value? Why?

- The typical customer of an S class is extremely wealthy and wants a brand new car as a symbol of prestige. They don't want an older model, they want the newest model, or the newest registration.
- There are not many other customers who can afford to buy and maintain such an expensive car.

Hence the market value drops, even though the car is still amazing, often with very little mileage on it.

That is a niche example though. The biggest factor for cheap second hand cars in the UK is the availability of finance plans and leasing. You can pay to lease a car for 3 years or 5 years and then, pay small top up fee and get a brand new model. The older car then goes into the second hand market. You can also easily get finance to buy a brand new car and pay for it on monthly installments. The British have a very lax attitude to taking on debt. Another crucial factor is that finance for new cars is available at a much better rate than finance for a second hand car.

Because of this people prefer to get new cars, rather than buy second hand cars, which drives down prices.

I bought a 2001 Honda Civic from a family member as a cheap car for my wife. She only recently learnt to drive and I didn't want to buy an expensive car. She crashed the first one i got her....lol

It is mechanically sound, it hasn't done a lot of miles, the body work is in good condition (no rust or dents, although the paint looks old now). It cost me £500.

In Pakistan that car would be worth 10 times as much I reckon.

Used cars are super cheap in the UK. You can easily find a £500 (600 usd) car that should last at least one year without major issues. Or a £1000 car (1200 USD) that lasts a few years without major issues.

The big problem here is that a first time driver is looking at minimum £1500 for insurance and cars that old usually cost £200+ in road tax.

 

[Daniel808]

All prices from dealer (buying from owner will be even cheaper):
View attachment 644856
View attachment 644858

Which site do you use bro?

 

[tower9]

Cool. What is the auto ownership ratio in China? In the US, it is like 95%.

Ownership percentage in China is still quite low compared to developed nations. These are stats from 2018, so China is probably at 200 vehicles per 1,000 persons now. The US has 804 vehicles per 1,000. Europe at about 600 plus per 1,000.

https://en.wikipedia.org/wiki/List_of_countries_by_vehicles_per_capita

 

[FairAndUnbiased]

Cool. What is the auto ownership ratio in China? In the US, it is like 95%.

Ownership percentage in China is still quite low compared to developed nations. These are stats from 2018, so China is probably at 200 vehicles per 1,000 persons now. The US has 804 vehicles per 1,000. Europe at about 600 plus per 1,000.

https://en.wikipedia.org/wiki/List_of_countries_by_vehicles_per_capita

it doesn't make sense to own in many places inc the license plate and the parking spot costs the same as a car.

In the US it makes sense to own because there's plenty of parking and registration fees are not that high.

 

[letsrock]

Thanks to the chinese - it will give poor people in india, pakistan and africa a chance to own cheap second hand cars and treat their families with dignity. But once too many poor indian people get prosperous trust the venal and demoniacal indian state to hit back at poor with "demonetization" and nationalistic ban of chinese imports.

 

[Kai Liu]

Which site do you use bro?

The image is from 二手车之家：http://www.che168.com/ , This site mainly provides used cars from dealers, which is more expensive.
Here in China, more people use Xianyu （闲鱼）app to buy used cars from owners, you can even find very good less than 10 year old used cars with less than 500 USD,
There are some other sites you can also find used cars too, such as 58同城 (China's equivalent of Craiglist.com), etc.