Xu added that luxury cars are being sold to secure liquidity to pay back the debt, as the local property industry, depending largely on investment from private capital, has been going down along with the coal mining industry.
"Selling cars, for many, is the fastest way to get cash," he said.
"Some construction sites are left half-finished due to a lack of capital," a local used car dealer, surnamed Zhao, told the Global Times.
"More people began selling cars in late 2010 when the economy showed signs of dipping," he said.
Not that cheap?
But Zhao challenges the report by the Economic Observer.
"Getting a secondhand car at such a cheap price as reported is almost impossible," said Zhao, who has been in the secondhand car business for four years, trading brands such as Toyota, Land Rover, BMW and Benz at the local Sanlian Automobile Trade Market.
It's true that some people sell their luxury cars when they are short of money, but this year the secondhand car market has remained relatively stable, Zhao explained.
"Most of my clients are car scalpers. Recently there've been an increase in the number of visitors coming to enquire, most of whom are from outside Inner Mongolia," said Zhao, adding that it's become customary for locals to blow their compensation on luxury cars.
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