China has decided to address the now famous traffic jams in Beijing. In what should not be a surprise, but which has hit the European luxury car exports solidly in the market cap today, Beijing has cut the number of new car permits for the city to a third of what was allowed last year. So much for China being a “Growing” luxury importing destination.
Carmakers fell after China also moved to limit the number of new vehicle licenses it issues in Beijing next year to 240,000 – about a third of last year’s total – as it strives to reduce the effects of relentless traffic in what has been ranked as the world’s most congested city.
In Germany, the biggest faller was BMW. The luxury car group was down 6.2 per cent to €59.32, while Porsche lost 4.9 per cent to €59.40, Volkswagen slid 4.7 per cent to €122.10 and Daimler shed 4.7 per cent to €51.55.
If Europe’s plans for getting out of the current economic malaise was to concentrate on luxury exports to a growing emerging market in China. They are going to need to reconsider that game plan. China is going to be putting restrictions on all kinds of imports as time goes forward.
Europe is about to find it’s export rug pulled out from under it. What comes next?