License plate lottery in China aims to curb congestion

 China may have surpassed the U.S. when it comes to new car sales, but buying a car is only half the battle in some Chinese cities. While there is a large variety of different models available from dozens of manufacturers, including 11 different models from Buick alone, the amount of road space is not keeping up with the pace of car sales. And just recently, Tianjin, the fourth largest city in China with a population of 13 million, has become the fourth Chinese city after Beijing, Shanghai and Guangzhou to institute a lottery system for issuing license plates, the Wall Street Journal reports. And in some Chinese cities the price of license plates can exceed the price of a new car.

The lottery scheme is expected to work in approximately the same manner as in Beijing and Shanghai. Prospective license plate buyers first have to make a down payment to participate, and in exchange they receive a disc which they can use to register to bid on the year's allotment of license plates online. The city itself governs how many license plates are put up for sale each year, and then sets prices based on the bids received from prospective buyers. Those who had bid at or above the determined price for the year can then purchase them for the set amount. That is, if they're chosen -- and that's where the lottery aspect comes in. This year in Shanghai the price of a new registration for a new car has exceeded $14,000 in some instances.  Yes, these are just ordinary plates, not any special government plates that can allow their owners to skirt traffic laws. While the license plate lottery has made a serious dent in the number of new car sales in Beijing, with its 21-million population, and Shanghai, with its 23 million residents, the high prices tend to depress the sales of local brands, which tend to be less expensive than foreign brands. So the price of license plates is more likely to keep first-time car buyers away, while those who are upgrading from the old Mercedes-Benz S-class to the 2014 Mercedes-Benz S-class aren't really affected by the prices of the plates.

Just like Beijing, Tianjin will restrict cars with non-local plates from entering the city, in addition to enacting a system where some cars within the city are only not permitted to be used on one day of the week based on the last digit in their license plate number.