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China Nov auto sales jump ahead of tax cut expiry; extension eyed
December 12, 2016 / 7:02 AM / 10 months ago

China Nov auto sales jump ahead of tax cut expiry; extension eyed

(Adds full-year outlook, other details)

By Lusha Zhang and Jake Spring

BEIJING, Dec 12 (Reuters) - Auto sales in China surged for a sixth consecutive month in November, an industry association said on Monday, as consumers rushed to buy cars amid uncertainty over whether a tax incentive will be extended beyond the end of the year.

Sales in the world’s largest automotive market rose 16.6 percent year-on-year to 2.9 million vehicles in November, the China Association of Automobile Manufacturers (CAAM) told reporters at a briefing.

Over January to November, sales jumped 14.1 percent, buoyed by China’s move to cut taxes on small engine cars. Sales this year could rise 13 percent, said Xu Haidong, a CAAM spokesman.

While the tax incentive is set to expire at the end of 2016, an industry ministry official has said the government was considering extending the tax cut.

“The association hopes it will be extended and is waiting for information from the relevant departments,” Xu said.

Without the tax cut, analysts warn 2017 sales could decline or be flat, with CAAM previously saying growth would be at most 2 percent if the policy expires.

A Ford executive last week said the government could wait until the last day of 2016 to announce a decision and that the company was preparing for multiple scenarios. (Reporting by Lusha Zhang and Jake Spring; Editing by Himani Sarkar)

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