Auto sales in China soared 34 percent year on year in May, with passenger car purchases growing strongly due to government stimulus measures, an industry association said Tuesday. More than 1.1 million cars were bought last month, bringing sales in the first five months to 5.0 million, up 14.3 percent from last year, the China Association of Automobile Manufacturers said in a statement on its website.
Passenger car sales "continued to be a major growth driver of the industry" in May, rising 46.8 percent from a year ago to 829,100 units, it said. Production also increased sharply last month, up 29.6 percent year on year to 1.1 million units, it added. Boosted by government policies, May was the third straight month that both auto output and sales exceeded one million, a record, the statement said. China's auto sales outstripped the United States to become the world's largest car market for the first time in January, helped by Beijing's incentives to stimulate domestic consumption.
These measures included slashing purchase taxes on cars with engines smaller than 1.6 litres and subsidising alternative energy vehicles. The China Passenger Car Association has forecast auto sales in the nation could hit a record 11 million units this year, as sales in the rest of 2009 are expected to improve on the first five months, said Tuesday's China Daily.