Ferrari opens in Shanghai, joining pursuit of China's new super

SHANGHAI, China -- Miao Wenchang gazed at the red sports car parked outside the opening ceremony for Ferrari's first showroom in China on Saturday and beamed with national pride.

"China really has a lot of rich people now," said Miao, an office worker in his thirties.

China marked a milestone in the rise of its superrich when Ferrari opened the showroom. The Italian luxury automaker joined a rush of foreign luxury brands targeting an elite who have grown rich in two decades of economic reform and foreign investment.

Dozens of Ferraris cruised through the streets of Shanghai for the opening, driven by owners who brought them from as far away as Singapore and Hong Kong. The festivities were attended by celebrities including Taiwan pop singer Ritchie Ren and models in miniskirts emblazoned with Ferrari's dancing horse symbol.

The company said it hopes to double sales of its Ferrari and Maserati brands in China this year to 200 cars -- priced at as much as $360,000. Plans call for opening dealerships in 11 mainland cities over the next 18 months.

"Our problem is not doubling sales. Our problem is getting enough cars from the factory," said Richard Lee, chairman of the Maranello, the Italy-based automaker's Chinese joint venture.

Fears of the tax man or a populist political backlash once prompted many Chinese to hide wealth. But younger, more confident entrepreneurs are ready to flaunt it.

"More and more people are wanting to show off their wealth," said Rupert Hoogewerf, a British researcher who compiles an annual list of China's wealthiest. "There is a second generation of wealthy emerging that have money and want to spend it."

As many as 50,000 Chinese have accumulated fortunes of at least $10 million, Hoogewerf said. An upper crust of 100 to 200 have piled up $100 million or more.

"We're just starting to see people inheriting wealth," he said.

Much of that money is concentrated in Shanghai, China's biggest and richest city. Though Beijing is China's political center, Shanghai is the hub for finance and international business.

Mercedes Benz, BMW and other luxury automakers already have showrooms in this metropolis of 20 million people.

Italian designer Giorgio Armani opened a Chinese flagship boutique in Shanghai last month. Next door is a restaurant set up by French celebrity chef Jean-Georges Vongerichten.

Within walking distance of the Ferrari showroom in the lobby of a luxury hotel on Nanjing Road, a house-size model of a Louis Vuitton train case sits in front of a shopping mall.

The city has its own edition of Britain's Tatler magazine to report on the jet set social scene.

The dealership for Britain's Bentley automobiles had to turn away buyers for the $340,000 Continental GT after selling out its allotment within days, said sales manager Jin Henian.

"Our clients are willing to wait for a top-quality car, but we're just not able to keep up with demand," Jin said.

In a system where standards for disclosing corporate financial information are still rudimentary, an entrepreneur's luxury car can serve as reassurance to investors of financial strength.

It's not unusual to see luxury cars on the streets of cities such as Urumqi in the poor northwestern desert region of Xinjiang.

Ferrari says its expansion plans for China include outlets not just in more prosperous eastern cities but in places as remote as Chongqing in the southwest.

However, ostentatious displays still can awaken resentment in a country where the average annual income is just $1,000 and hundreds of millions of people get by on a few hundred dollars a year.

Last year, a public outcry erupted after a businessman's wife driving a $96,000 BMW sport utility vehicle struck a female farmer on a street in the gritty industrial northeast.

The driver was cleared in what the Chinese press termed the "BMW Collision Affair." But accusations that she got special treatment because of her family's money prompted local authorities to order a new investigation, which exonerated her a second time.

At the Ferrari dealership in Shanghai, Miao chuckled at a question about whether he might consider buying one of its sleek, low-slung cars.

"I won't make that much money in my whole life," he said.