According to Mr Xian, the policy is adopted from Beijing and Shanghai’s experiences. Beijing, which started limiting car registrations in 2011, allowed 240,000 vehicles to be registered last year via monthly lotteries.
Shanghai introduced a public auction system to grant new license plates in 1994. Mr Zheng Fenming, director of the Institute of Modernization Strategies under the Guangdong Academy of Social Sciences, suggested to increase the proportion of car license plates to be
auctioned to increase the cost of ownership.
However, not all is supportive of Mr Zheng’s view. Mr Han Zhipeng, a member of the Guangzhou Committee of the Chinese People's Political and Consultative Conference, said, “Why should the rich, or those who really want to buy their cars, have to pay more to be granted car license plates via auctions?"
He suggested that a fairer approach is to allow only 30 percent of the license plates to be granted via public auctions while the remaining 70 percent should be granted through a lottery.
Perhaps, LTA should examine the approach that Guangzhou is adopting. For some young families with kids, a car is a necessity and not a luxury item. High COE cost may indirectly have an impact on birth rates. How about allowing 50% of the monthly COE allocation to be balloted ?