Anjani Trivedi:

BMW has been a market leader in providing financing, and its auto-financing penetration levels in China have risen from 36% in 2013 to almost 50% in 2016, according to Bernstein analysts. Yet borrowing costs aren’t standing still. A BMW-backed ABS in China was issued at 4.2% in December, just months after it issued an ABS at 3%.
 Already, car sales are showing signs of coming off their peak levels, especially with stresses rising in the money markets. Demand is slowly shifting beyond China’s first- and second-tier cities, to where income levels are lower—and where the ability to pay off loans quickly is potentially lower. Going by Beijing’s track record, it could continue to push lending to support the car market. But it could be a lot tougher this time, as stresses elsewhere in the financial system build.