Porsche opens dealership in Inner Mongolia as A-M expands

Luxury cars fever is spreading to some of China’s most remote areas as demand continues to soar.

Anyone who has been to downtown Beijing, or for a stroll along the bund in Shanghai, will no doubt have seen the fleets of luxury cars which have seemingly appeared almost overnight. Just five years ago, a parked Porsche, Maserati, Bentley or Aston Martin would have attracted a gaggle of fascinated spectators cueing to take pictures and marvel.

Nowadays citizens will barely bat an eyelid at a 911 Turbo. In fact, foreign luxury carmakers are having to go further and further afield to sell, as Porsche’s latest dealership in the desert province of Inner Mongolia shows.

The luxury German automaker has recently opened a dealership in Ordos – a sparsely populated mining city – after March sales slumped 10-fold to paltry 200 vehicles and will soon be followed by the likes of Volkswagen AG’s Bentley and Fiat S.p.A.’s Maserati. Luxury carmakers have shown a strong trend toward the countries internal market recently, as the Eastern coastal cities become increasingly saturated.

Aston Martin is also aiming to cash-in on the need for speed with news that it is set to open a further 13-15 dealerships in 2012, with a sales target of 500 of the iconic British cars, up from 220 last year.  Currently, only five Aston dealerships exist in China.

Despite ownership of premium cars lagging slightly behind the global average, luxury car ownership in China continues to skyrocket. In 2011, luxury cars accounted for 24% of all vehicle sales in Beijing - more than double the U.S. average of 11%. However, buying luxury cars is an expensive habit, especially in China, where imported luxury cars will often cost more than twice as much as their purchase price in abroad.

In the UK, for example, those with deep pockets might fork out around $200,000 for a brand new Bentley Continental GT, while their Chinese counterpart may pay up to $584,000 for exactly the same model.

Nonetheless, with over half a million millionaires with a combined wealth of $2.7 trillion in China, Porsche and Aston Martin can certainly count on a relatively large customer base, especially across the increasingly affluent inland provinces. Porsche sales rose dramatically last year, even to the point where they were running out of luxury SUVs to sell!