The trials and tribulations of a Chinese motorcycle dealer

Dealerships in China have had to adapt to the issues caused by the banning of internal combustion engine motorcycles and those who haven’t been smart have had to shut up shop. We spoke to Chongqing motorcycle dealer Hu Feng about the trials and tribulations of the business.

At his showroom in Shapingba district of Chongqing it’s amazing to see how many other businesses operate in the same industry all in the same place. This region is Chongqing’s motorcycle ‘market’, an area the size of a town that is dedicated to all things moto. There are numerous markets in Chinese cities in which all the businesses focus on the same products from windows to mahjong tables. We let Mr Hu introduce us to his work. “Before working for myself I was a technician at Yingang Motorcycles. I’m pretty handy with mechanical things so about ten years ago my wife convinced me to set up in a small rental unit close to our house. To begin with I got by doing tune-ups and general repairs for anyone who brought in their bikes with a problem. I branched into buying old bikes, fixing them up and selling them on for a profit which lead to extra income. After 5 years of saving up we had enough to open a dealership we purchased this 50m2 showroom that now houses our business.”

“This place was the perfect location to set up because it’s in the centre of the motorcycle retail district. We began with just a handful of models from a single manufacturer but as time went by we diversified and are now stocking multiple brands. Our best sellers are standard commuter bikes, 125cc and 150cc size models but cruisers are rising in popularity, especially an automatic from CFMoto which comes with plenty of chrome.”

“Most of the people I know, friends and family, are connected to the motorcycle industry. A guy I went to school with opened a dealership in Chengdu, the neighbouring city and over the last 8 years he’s made big changes in how he operates. Chengdu has a motorcycle ban much like most other big Chinese cities so trade of regular motorcycles isn’t viable and electrics have become the choice for customer. Luckily Chongqing doesn’t have the motorcycle ban but we still do have some trade for electric scooters. My wife’s cousin has a small shop in Fengping, a smaller city in the north of Chongqing, which does a big trade in 3 wheeled ‘tuk tuks’ for both farmers and disabled people; the latter using them as a way to get around where they otherwise couldn’t.”

“To start with we didn’t bother with accessories because everyone else around us was selling those. A sideline we did pick up was helmet sales. Due to motorcyclist being cracked down on by police for not wearing helmets many are keen to get a helmet while purchasing a new bike. Most will take their bikes to smaller shop like the one I used to own when they need repairs or sometimes they’ll do it themselves if they have the means.”

“Some of our business comes from recommendations. Business is stable and even though Chongqing is a motorcycle city more of the working classes are becoming able to afford cars making it tough for some of the other dealers on our block. Lots of the newer dealership owners will stick to a single brand and the lack of choice drives customers elsewhere. Many go under within months of opening. We don’t stock scooters because the majority of other dealers here have an abundance of them and the quality of some of them is questionable because they aren’t made here. Most of the scooters come from Zhejiang or Guangdong.”

“Chongqing city is surprisingly small considering it has a massive population. All of the city’s motorcycle business is down within this district alone so there is enough business for everyone who can maintain a good business practice. I hear that it doesn’t work this way in other countries and their motorcycle traders and technicians are spread out across the cities. Here it’s very easy to get a paint job, engine rebuild or a ground effects kit all in one place thanks to the way all the shops are clustered together. One could spend a day just browsing the bike parts stores and it’s certainly possible to build a bike from scratch with the availability of kit here.”

“Our next step may be to venture into selling the 3 wheeler tuk tuks. The local government has a scheme to subsidize the purchase for people with disabilities so they can earn money as taxi drivers and delivery drivers. The problem is that the 3 wheelers produced here are selling for much higher prices than they are elsewhere so if we go down that route we may be buying from outside of the province and shipping them in.















March 16, 2016