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Automakers launch financing schemes to boost sales

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Shanghai, September 26, 2008 ( Automakers in China are joining hands with financial institutions to offer new credit deals to potential customers in the country amid market downturns, reports China Daily.

Dongfeng Honda Automobile Co has also teamed up with Shenzhen Development Bank Co. Ltd to launch several trial auto-finance services in Shenzhen. Customers looking to buy Civic, Civic Hybrid or CR-V sport utility vehicle (SUV) models will also be able to apply for a loan without a guarantor.

Separately, Dongfeng Yueda Kia Motor Co. Ltd also tied up with China CITIC Bank Corp's Credit Card Center to launch an installment payment service, known as "Super Cool 003 Plan". The scheme, which has been launched in 11 Chinese cities, allow customers to apply for loans between 40,000 yuan and 200,000 yuan (US$5,880-US$29,4000), without a third party guarantor as a requirement.

Brilliance BMW said it has begun to offer zero percent financing to buyers for 24 or 36 months from September 8 to November 30, which allows BMW car buyers to pay 30% or 40% of the retail price and then spread the loan into the next two or three years.

Industry analysts observe that many automakers have adopted car financial services to stimulate vehicle sales in China, after demand cooled after inflation neared a 12-year high and a stock market slump reduced consumers' spending power. Other one-off factors including the holding of Beijing Olympic Games and natural disasters which deterred customer purchase.

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