Ritchie Bros on course for first Chinese auction

Ritchie Bros Auctioneers remains on course to hold its first auction in China early in 2013 with regulatory approvals moving forward and an auction site in Beijing being lined up.

Chris Edwards, Ritchie's representative in China, told IRN that the company had just received its temporary registration as a wholly foreign owned auction company, the first in China. This does not allow the company to hold auctions, but it paves the way to full registration, with final statutory filings now being completed.

The date of the auction will be announced at the Bauma China exhibition in November, but Mr Edwards, speaking to IRN at Ritchie's Chinese head office in Beijing, said it would be held in early 2013.

A temporary auction site will be developed at the Tian Zhu free trade zone next to Beijing's international airport. Free trade zone status will make it easier for foreign buyers to export machines out of China after the auction.

Mr Edwards said the timing remained very good for the launch of a construction equipment auction business in China, with the significant downturn in the market meaning that OEMs and dealers have excess inventories of used machines that they need to sell.

"The downturn over the last 12 to 18 months has put huge pressure on fleet owners, dealers, OEMs and finance companies. They are overwhelmed with non-performing equipment", said Mr Edwards, "Hopefully, more so than ever, our model is exactly what is needed. They are in a situation where they need this - they need another options for used equipment."

Ritchie hopes to attract buyers from all over China as well as from outside the country, including from Africa, South Asia, South East Asia and the Middle East. Many Chinese brands are already well known in these areas.

"After we have proved that we create value for buyers and sellers, we see huge potential for Ritchie Bros in China", said Mr Edwards. He said other auctions sites would be investigated in the country and that its second location would probably not be in Shanghai; "There are lots of provinces with large equipment populations that can be just as attractive".