Dec 30, 2014 06:54 PM

Stop Lights Flash for Auto Buyers in Shenzhen

(Beijing) – The Shenzhen government has decided to cap the number of new sedan car license plates issued every year at 100,000 as part of an effort to tackle traffic congestion and reduce air pollution.

News of the cap in the southern metropolis in Guangdong Province was included in a government notice released December 29.

Among the measures taking immediate effect, the city banned all vehicles licensed in areas outside Shenzhen from entering four, downtown districts during rush hour periods on workdays.

Many locals considered the moves drastic and shocking because Shenzhen Mayor Xu Qin had promised in January 2014 not to impose any restrictions on new-car purchases. He told reporters during the Guangdong People's Congress that administrative measures would be deployed only when market-oriented solutions failed to address traffic woes.

The about-face made Shenzhen the seventh Chinese city after Beijing, Shanghai, Guangzhou, Tianjin, Hangzhou and Guiyang to impose restrictions on new-car purchases in order to ease traffic congestion and make it easier to breathe.

Zhao Jian, a professor at Beijing Jiaotong University's School of Economics and Management, said these restrictions on new-car purchasing reflect a lack of creativity among policymakers. He said such drastic measures might give the government a shortcut to achieving its goals, but that these measures would not be sustainable because some issues remain unresolved and would have to be tackled by future leaders.

Meanwhile, the restrictions are likely to disrupt the plans of many potential car buyers in the Shenzhen area: The quota system is likely to prevent at least 340,000 consumers from buying the cars they want.

Shenzhen's government said the restrictions would be in place for five years but would be subject to revision, pending assessments of traffic and air quality.

According to the city government, the number of vehicles has grown by an average of 16 percent each year over the past five years to 3.14 million. In 2014, the number of new vehicles in the city grew by 550,000 units. And sedans account for more than 80 percent of all new vehicles.

But officially, the city has only 1.04 million parking spaces. And traffic congestion downtown during evening rush hour periods has grown substantially: What used to be 38 minutes of gridlock in 2012 is now about 55 minutes long.

Moreover, vehicle emissions have been blamed for 11 percent of the PM2.5 pollution reported in Shenzhen.

The city government said the 100,000 new-car licenses allowed every year would be distributed according to a monthly quota system. Some 20 percent of the quota, or 20,000 new plates, will be reserved for buyers of electric cars through a monthly lottery draw. For the rest of the quota, half will be chosen via lottery and half via auction.

(Rewritten by Li Rongde)

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