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China is home to the world's flashiest cars. What's behind this new trend?
Smart Planet, April 7, 2014
Beijing might be famous for being the city of nine million bicycles, but in the Chinese capital, cars are now king. A world-record breaking 20 million automobiles were sold across the country last year, making China the world’s largest car market.
With 200 new models released yearly in China, you'd be forgiven for thinking that Chinese customers would be overwhelmed for choice. But, as it turns out, a new group of consumers has emerged who think that what's on offer in showrooms isn’t enough. They arethe'Tuner Tribe' – a subculture of drivers who are investing thousands of dollars to 'pimp up' their rides.
Numbering in their thousands, they are a small minority of the country's 137 million car owners. But increasing interest in car customization is a sign of a broader trend in China. A new generation of wealthy, globally-connected consumers is emerging. For them, standing out from the crowd isn't to be feared; it's to be pursued.
From Lamborghinis coated in matte pink to local models given a chrome body finish, evidence of the bespoke car craze can be seen in cities across China. Nowhere are the cars more flamboyant than in Beijing's Tuning Street, a hub of 50 garages in the east of the city. Since this commercial district first opened its doors in 2009, mechanics have been lining up to make drivers' dreams a reality.
Located in a poor, dusty area of the capital, where most of the migrant residents can only dream of being able to afford four wheels, Tuner Street has nevertheless become a mecca for car lovers, attracting scores of affluent automobile owners from as far as 60 miles away. Customization services on offer range from changing hubcap colors for $60 to covering the entire car with diamante for $13,000.
In his garage, where BMW and Ferrari flags hang from the ceiling and images of blinged-out car models line the walls, Gao Xingwan drives a hard sales pitch as he shows off a Porsche he’s been working on: “These glow-in-the-dark stripes only cost ¥4,500 [US$730]. A very low price considering this car cost ¥1 million [US$162,780].”
Techno music pumping in the background, at one of the larger car shops we meet Zheng Zhuan, a saleswoman who brings out color samples for us to look at, including some with a glittery sheen, which she describes as a ‘pearl’ hue. “We place this like a sticker over the entire bodywork. That way there’s no damage done and you can easily change your car color as many times as you like. Some customers change their car design as often as once a month.”
Most of the customers at Tuning Street are in their twenties and thirties – a sign, says Timothy Coghlan, the luxury brand consultant behind maosuit.com, that a new generation of young, wealthy, Chinese urbanites are now confident enough to stand out from the crowd. “Buying a luxury car is no longer enough, they want to show their identity through their purchase,” he says. “We see this in the fashion sector too. It’s not about buying the brands my friends have anymore. It’s about buying the brands my friends don’t have, to show my individual take on the world.”
In Japan, where Coghlan lived previously for five years, customization primarily meant jazzing up car interiors with items such as leather-rimmed, drop-down televisions. But he says, Chinese drivers are mostly decorating their cars to “show off to the outside world.”
This shift indicates that a more connected China is coming into line with global trends, he says. “Young Chinese people have grown up with the internet. As they see what's out there in the world, former taboos are breaking down. Wearing a bright pink outfit to the office or driving a bright pink car no longer makes you weird. It makes you you.”
Wider social forces are at work too. More affluent, better educated than their parents, and often the only child in the family, the latest generation of consumers is fostering and being fostered by a new 'me culture,' concerned with exhibiting an individual identity.
Bill Russo, the founder of advisory firm Synergistics, who boasts several years of experience in China’s automobile industry, also thinks many Chinese drivers treat their cars as “trophies on wheels.” In more mature markets, even when buying luxury cars, consumers still look for value for money, says Russo. But in China, where the buyer of a Mercedes is more likely to be aged under 40 than above 50, there’s a “buy as much as you can afford” attitude.
Government policy has heightened this mentality. In an attempt to curb off-the-scale pollution, an increasingly restrictive quota has been placed on the number of new license plates released each year in big cities like Beijing. The result, says Russo, is that because consumers are not sure when they will next be able to buy a car, they want to purchase the newest, most expensive, best model they can. Adding bespoke design is just another way to make their new trophy shine even more. Some customers will buy the latest Porsche only to take it to a garage the next day and cover it up with customized color stickers.
Chinese bureaucracy also plays a more direct role in the fad for customization: When license plates are registered, owners also need to register the color of the car. Colors can’t be changed without official permission, which can be hard to obtain.
That’s where Beijing’s enterprising small businessmen come in. By placing giant stickers over a car’s bodywork or adding diamante detailing, they allow consumers to change the look of their vehicle, while side-stepping government restrictions.
Now that Chinese consumers are getting used to customizing their cars, will overseas manufacturers follow demand? Russo points out that if brands were to allow customization, or at least release limited editions of certain models with unusual colors or added stripes, this could be a way to keep notoriously fickle Chinese consumers interested in a model throughout its shelf life.
“Cars models typically have a five-year lifecycle but in China sales begin to drop quickly as early as a model’s third year on the market. Customization could help keep models exciting.” he explains.
After all, as Russo puts it, “In China, if it’s not new, it’s not hot.”