Vehicle sales in China slipped 0.1 percent in May from a year ago, after falling 2.2 percent in the previous month, according to the China Association of Automobile Manufacturers (CAAM).
It marked the first time since 2015 that auto sales in the country registered two consecutive months of declines, Reuters reports, citing the effect of a rollback of a government tax incentive.
Vehicles sales last month stood at 2.1 million units, continuing a slide from April when sales dropped the most in 20 months.
For the first five months of 2017, sales were up 3.7 percent from year-ago levels, CAAM was quoted as saying at a briefing in Beijing.
This was smaller than the 7 percent growth seen over January-May period in 2016 and also trails the industry association’s forecast for 5 percent growth this year.
China’s auto market recorded 13.7 percent growth in sales last year after the government halved the purchase tax on vehicles with engines of 1.6 liters or below to 5 percent to stimulate demand.
The tax climbed to 7.5 percent this year and will rise to the normal 10 percent next year.
Sedan sales fell 9.3 percent year-on-year in May.
Sport-utility vehicles proved to be the lone bright spot for passenger vehicles last month, as sales grew by 13.5 percent.
Foreign brands that are strong in the small sedan segment have seen sales slow this year, with General Motors, Ford and Volkswagen all recording lower sales in the first five months of the year.
Meanwhile, commercial vehicles posted rapid growth, led by lorry sales that grew 18.3 percent, which are usually linked to the strength of the overall economy.
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