New environmental rules in China ban imports of super luxury cars such as those made by Lamborghini and McLaren, keeping “small volume” carmakers from their biggest market.
The recently employed Clean Air Act removes an emissions exemption high-end sports car manufacturers had enjoyed. In addition, China last year imposed a 10 percent tax on vehicles that cost $200,000 or more.
Still, the Chinese luxury car market is seeing strong growth, with sales up nearly 40 percent the past year. Outlooks are similarly robust. By 2020, China will be the world’s largest luxury car market, according to Smart Research, outpacing the U.S. Daimler recently announced plans to double capacity for its Mercedes Benz division at its Beijing plant.
Daimler is a large volume car manufacturer. The Clean Air Act takes aim at manufacturers that produce small numbers of extremely expensive luxury vehicles. Aston Martin and Morgan Motor Company, for example, are also being shut out of China.
A new Aston Martin DB11 lists at more than $250,000, while a Morgan is about $100,000. Production volumes on such luxury cars are tiny compared with big automakers. While Ford and other mass automakers produce millions of vehicles per year, a company such as Aston makes fewer than 10,000 annually.
Small batch sports cars are meant to be more status symbols than daily drivers. The average high-end super car is driven less than 5,000 miles per year.
China’s environmental regulations had previously included a ban on super cars because of their low fuel efficiency. (The U.K.-based television show "Top Gear" did a fuel performance test of super cars, including an Aston Martin, Ferrari, McLaren and Lamborghini, and showed that, when driven at race speeds, their fuel efficiency can plummet to as low as fives miles per gallon.) But small volume carmakers sought and received an exemption to the rule. That was until the Clean Air Act came into effect in March.
The Chinese government isn’t keen on conspicuous consumption and as part of an anti-corruption campaign has cracked down on sales of luxury cars, business jets and yachts by imposing additional taxes.
It isn’t clear whether the super-car exemption was allowed to lapse on account of the environment or on account of the corruption campaign. Either way, luxury cars on order are left sitting in the lot.
