GUANGZHOU -- Owning a car is growing more difficult and expensive in major cities of China, with winning bids surging in monthly auctions for license plates.
A December auction in Shenzhen, in the southern Chinese province of Guangdong, fetched 95,103 yuan ($14,531). This amounted to two and a half times the price seen at the start of the year and the highest in the nation.
As even more cars hit their already congested roads, cities are limiting annual issuances of license plates and allocating some by lottery and others by auction. Shenzhen decided to issue just 100,000 in 2017, with 40% going to winning auction bidders.
Shenzhen, called a Chinese Silicon Valley with many startups, has been an investment destination in recent years. But this has also meant more car buyers, resulting in severe traffic congestion downtown. The city moved in 2014 to cap vehicle purchases, fueling competition for license plates.
Shanghai is the second-priciest city in China, with a winning bid of 92,848 yuan in December -- a sixth straight month of license plates costing more than 90,000 yuan for auction bidders. Guangdong Province's Guangzhou has seen the value of winning bids jump 85% over this year.
The license plate costs in Shenzhen and Shanghai are nearly as much as the roughly 100,000 yuan typically shelled out by the Chinese consumer for a new vehicle.
China already has some 200 million autos, causing heavy traffic jams in regions around the country. Many other cities are sure to adopt ownership restrictions, likely pushing up license plate costs further.