Some car buyers might find Shanghai license plates becoming out of reach as the average successful bidding price hit a record high of 54,317 yuan (US$7,316) at the monthly plate auction on Saturday.

 

The average winning bid for a private plate rose 3,317 yuan from a month earlier, a 6.5 percent increase, an official with Shanghai International Commodity Auction Co said on Saturday.

 

The growth was the fastest pace this year compared to previous monthly increases of 1,000 yuan to 2,000 yuan.

 

About 10,596 bidders joined the race to buy 7,500 car plates offered by the local government.

 

The lowest successful bidding price was 53,800 yuan, up from 50,500 yuan in October.

 

"Bidders offered higher prices amid anticipation of more expensive plates in the future," said dealer Shen Gang.

 

"In addition, auto buyers are less sensitive to the price after the surging stock market has filled their pockets."

 

Shanghai, the only city to issue car license plates by auction, has seen plate prices increase fivefold since the auction system began in 2000.

 

Some analysts also said the rocketing prices for car plates were also caused by difficulties in the bidding process.

 

"The system can easily cause bidders to place higher prices," said Zhu Junyi, an analyst from the auto research department under the city's information center.

 

"The price is also getting higher due to manipulation by dealers as they usually give indicative prices to bidders in advance."

 

Zhu suggested the government adds more bidding opportunities as well as tightening its control on dealers. Shanghai began restricting license plates in 1986 to ease traffic congestion in the city. The next auction will be on December 15.

 

(Shanghai Daily November 19, 2007)