With several nearby cities refusing to sell license plates to Shanghai residents and the local government strictly controlling the number of plates it sells each month, prices hit a record high at an auction over the weekend.

　　The average winning bid at a sealed auction for 4,800 license plates on Saturday was 40,053 yuan (US$4,826). That is 537 yuan higher than last month's average winning bid, when there were 200 fewer plates for sale.

　　The lowest winning bid this month was 39,600 yuan, up 1,600 yuan from last month, according to Shanghai International Commodity Auction Co, the auction organizer.

　　Shanghai auctions off plates to individuals and private companies at a sealed-bid auction every month. By limiting the number of plates for sale, the city controls the number of new cars on the road.

　　More than 10,000 people bid for plates on Saturday.

　　Plate sales are a good indicator of the number of cars on city streets. The city only sold 14,000 plates in 2000, but auctioned off 53,068 last year.

　　Even that number is far short of local demand.

　　In the past, more than 20,000 local residents have bought much cheaper plates from nearby cities, such as Suzhou. But those cities have started implementing strict rules to prevent Shanghai residents from buying plates in Jiangsu or Zhejiang provinces for cars that will mainly be used in Shanghai.

　　Xiang Ming, an analyst with China's Motor Development Research Office, said Shanghai's tough policies have helped it avoid the severe traffic problems facing Beijing, where license plates cost only a few hundred yuan.

　　While the number of private cars in Shanghai doubled last year to 200,000, there are still only half as many vehicles here as there are in the national capital.

　　The cost of plates in Shanghai is hurting sales of economy cars more than luxury vehicles, according to industry analysts.

　　Of the 78,043 cars licensed in the city last year, less than 4,000 were priced under 100,000 yuan. By comparison, more than 29,000 cars costing over 200,000 yuan were licensed in the city in 2003.

　　Analysts said many potential buyers of economy cars are put off by license plates that cost more than one-third as much as their new hatchback. Luxury car buyers seem less concerned about the added price, however, they said.

　　According to statistics, the average winning bid for a license plate was 35,000 yuan last year.