The trials and tribulations of a Chinese motorcycle dealer
A report by David McMullan the Englishman in China
With the implementation of urban banning of traditionally fuelled motorcycles in most Chinese cities, Chinese motorcycle dealerships have been adapting, or closing, at a record rate. Hu Feng, a Chongqing motorcycle dealer gave me an insight in to the trials and tribulations of a Chinese motorcycle dealer.
Mr. Hu owns a 50 square metre motorcycle showroom in the ShaPingBa district of Chongqing. His shop is part of a sprawling motorcycle industry retail district that covers every aspect of motorcycling and maintenance. In Chinese cities industries tend to cluster in one region, in Chongqing there are centres for plumbing, windows, mahjong tables and motorcycles among many other industries. Hu introduces his shop. “9 years ago I was a technician with the Yingang Motorcycle Company; I have some talent fixing motorcycles so my wife encouraged me to rent a small unit near to where we live. We started a motorcycle repair shop fixing just about anything that was brought to me. Then I started buying scrap motorcycles, fixing them up and selling them. We started to make some money so we saved hard for 5 years in order to set up the dealership.”
I asked Mr. Hu about his location and product range.
“We set up in the ShaPingBa district because it’s the centre of motorcycle retail, parts and accessories in Chongqing. At first we concentrated on trading one brand, Xingang, but after a while we started to diversify and now we’re not tied to any one brand. Our top sellers are the 150cc standard commuter bikes, but we also sell a good few cruisers, especially the CF Moto auto which is a really nicely chromed ‘twist and go’ cruiser.”
How does business in Chongqing compare to other cities and regions?
“I have other friends and family in the industry. My ex school friend has run a dealership in Chengdu (Chongqing’s neighbouring city in Sichuan province) for over 8 years but he’s seen big changes. Because of the ban on fossil fuel motorcycles in Chengdu he now only stocks electric scooters. It’s a big business in Chengdu. I only keep 2 or 3 electric scooters in stock because Chongqing has more traditional motorcycle values and of course, no ban! My wife’s cousin has a small dealership in Fengping, a village in the mountains of Chongqing. He has seen a big upturn in the sales of three wheel ‘tuc tucs as the agrarian community now has the income to motorise itself, which in turn improves their lives and profits.’
I wondered how much of Mr. Hu’s business consisted of the sales of accessories; also did he make reasonable money from tune-ups?
“We hadn’t stocked any accessories until last year. This area has dozens of accessory shops and we leave that trade to them but last year we started stocking helmets due to the law change (motorcyclists are now required to wear helmets) and we remind people to buy one when they purchase the bike. It has turned in to a good side-line. We don’t have too many people coming back to us for tune-ups on the bikes, Chongqing motorcyclists are quite bike savvy, if they’re not then they are more likely to go to a small repair shop like my old business.”
The Chinese domestic motorcycle industry is suffering a big slowdown, how is trade?
“Business is steady, we’ve been here a while now and we get recommendations. Even though Chongqing is the motorcycle city of China more and more people can afford to buy cars now so the motorcycle retail industry is just steady. A lot of new operations start up and go under within months, I think one of the reasons is that they tie themselves to one brand, we did that in the early days, and customers like to go to a shop with a good selection. We do not stock scooters though, apart from the electric ones, as they are over represented in this area and I’m not sufficiently impressed by the scooter quality as they are not made in Chongqing.” (There is no scooter production in Chongqing. Chongqing companies do sell scooters but they are produced in Zhejiang and Guangdong provinces.)
I enquired about the catchment area for his business
“Despite having a population of over 10 million Chongqing is not a big city in terms of area. Our catchment area encompasses the whole of Chongqing so there is enough business to go around as every motorcyclist will come to this area. I understand it’s very different from the industry in other countries that have dealerships scattered all over the city, like Bangkok, here we have an area specifically dedicated to everything motorcycle related. If you wanted to build a motorcycle from scratch you should just spend a day shopping at all the little parts outlets. You can even get a paint job and order stickers and decals. We all have our partners here that we refer our customers to. If someone is looking for stylish fairings I refer them to my friend, if he knows of anyone looking for a motorcycle he refers them to me.”
I asked Mr. Hu if he was planning any additions to his range and if there was any shift in trends
“We are contemplating whether to stock and sell tuc tucs. The Chongqing government subsidises tuc tucs for disabled people so that they can make a living as taxi drivers and haulers. At the moment tuc tuc manufacturers in Chongqing are not selling as cheaply as in other provinces, mainly because they are mostly made by bus manufacturers like CQ Bus Company and are top quality products. I’ll look in to bringing some in from Zhejiang province as a trial; it’s where my wife’s cousin gets them from”