BEIJING (Reuters) - China’s vehicles sales in March rose 4.7 percent from a year earlier to 2.66 million, an industry body said on Wednesday, strengthening after a week-long national holiday led to a steep drop in sales a month earlier.
The rebound comes after China vehicles sales in February fell 11.1 percent from a year earlier amid faltering growth in the market since the second half of last year.
Vehicle sales in the first quarter were up 2.8 percent compared with the same period last year.
The China Association of Automobile Manufacturers (CAAM) has predicted a 3 percent market growth this year, in line with 2017, but significantly below the steep 13.7 percent gain in 2016. Sales last year missed a target of 5 percent growth.
A CAAM official said plans to cut tariffs on imported cars would pressure domestic automakers, although they should be able to bear it. President Xi Jinping said on Tuesday China would “considerably reduce auto import tariffs”.
Asked about the plans, CAAM assistant secretary general Xu Haidong said he did not expect auto import tariffs to be cut that low, but that a reduction to 5 percent could drag domestic auto market profits down 20 percent versus current levels. The tariff on imported cars is 25 percent now.
CAAM said sales of new energy vehicles (NEVs), referring to pure electric and plug-in hybrids, rose 117.4 percent in March to 67,778 units. Sales of NEVs in the first three months of the year were up 154.3 percent at 142,577 vehicles.
China is making a major push to support the NEV sector and drive a shift away from traditional petrol-engine cars, though it is looking to wean the sector off subsidies that have helped drive rapid growth.
CAAM has previously said the NEV market would grow around 40 percent this year to top sales of 1 million low-energy cars.
The industry body said that German, French and Japanese carmakers had seen a rise in passenger vehicles sales overall in the first quarter, while South Korean and U.S. firms had seen sales slip against the same period last year.
Chinese brands took a 45.19 percent share of the overall market in the Jan-March period, slightly down against 2017.
Reporting by Min Zhang and Norihiko Shirouzu in BEIJING; Writing by Adam Jourdan; Editing by Sunil Nair and Biju Dwarakanath