Senior government economist Xu Changming told an auto forum that China’s auto sales in September will definitely exceed 1.2 million, and will likely total around 1.25 million units.Further, full-year auto sales in China could total around 12.6 million units, and could possibly exceed 13 million units.
China’s auto industry posted its strongest monthly growth so far this year in August, when overall auto sales rose 81.7% from a year earlier to 1.14 million units.
Earlier this year, China halved the purchase tax on automobiles with engines 1.6 liters or smaller to 5%, and introduced subsidies to encourage sales of some autos in rural areas. Both policies are set to expire at the end of the year.
The tax cut provides consumers with savings of RMB4,000-5,000 per vehicle, but costs the government RMB12 billion a year.
Wall Street Journal Online reported that China’s Industry Minister, Li Yizhong, said in mid-August that policy makers haven’t discussed extending the tax cut.