Just weeks after the opening of four Chery dealerships in Venezuela, dozens of people are lining up every day to buy the first Chinese cars being sold in the Latin American nation.
Unlike competing Japanese and US cars, import preferences granted by the Venezuelan government mean the Chinese cars are cheaper, which has attracted a steady stream of interested customers.
“I came to buy here because elsewhere there are no cars and this is an alternative,” stylist Juan Hernandez, 33, said while waiting in front of the dealership.
The entrance sign is still covered in black plastic, but already draws attention from passersby on a busy road in Caracas.
The cars are assembled in Venezuela under an agreement with China, who Venezuelan President Hugo Chavez considers a major ally. The manufacturing enterprise is financed jointly by Chery Automobile Co (奇瑞汽車) and a Venezuelan public-private company.
Three other Chery dealerships are operating in other parts of Venezuela. The manufacturer plans eventually to expand to 18 Venezuelan dealerships.
Chavez named the car models the Arauca and Orinoco after two rivers that run through Venezuela.
Until sales of the Chery began, Venezuela suffered a shortage of cars because of import and exchange controls on other foreign vehicles.
Japanese and US brands such as Toyota and Chevrolet operate plants in Venezuela, but they do not benefit from “exchange preferences” like the Chinese companies, according to economist Jose Guerra.
“Cadivi [the government agency that oversees foreign exchange] provides discretionary dollars and encourages Chinese enterprises” because of the close relations between the Venezuelan and Chinese governments, he said.
For customers like Hernandez, the previous scarcity of automobiles meant delays in being able to buy a new car, which led him to lose his bank credit line for the purchase.
Now he wants to buy an Orinoco for about US$30,000, which he says is “a little cheaper” than other similar models in the expensive Venezuelan market.
“The first weeks we were helping 250, 300 people a day, but it was overwhelming and some employees quit the first day. Now we serve customers according to identity card numbers and that’s about 150 people daily,” Carlos Vargas, the Chery dealership manager said.
The auto dealers have been able to keep up with demand so far because the manufacturing started months before the -dealership opened.
The dealership’s management hopes to sell about 400 cars a month when sales reach a normal pace, which Vargas says will likely be later this year.
About 5,000 of the vehicles were assembled last year by the Chinese-Venezuelan enterprise. This year, they hope to assemble 18,800 of the vehicles.
Other Chery cars are imported from China, but mostly for sale to officials and offering better options than many cars purchased at the dealerships.
The Cherys are only one line of Chinese products recently offered in Venezuela under trade agreements.
Since 2010, Venezuelans have been able to buy Chinese mobile phones and household appliances, which are sold for discount prices at state stores.
Other trade agreements cover oil and housing.
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