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China auto sales fall 2.6% in May; SUV sales up

BEIJING — China’s auto sales shrank for a second month in May amid weak demand following a rise in the sales tax, an industry group reported today.

Sales in the world’s biggest auto market by number of vehicles sold contracted 2.6 percent from a year earlier to 1.75 million vehicles, according to the China Association of Automobile Manufacturers.

Purchases of SUVs rose 13.5 percent 715,000, helping to offset a 9.3 percent plunge in sedan sales to 839,000.

Sales last year rose 15 percent from 2015 after a 10 percent sales tax on small-engine vehicles was cut by half. Demand weakened after part of that tax was restored in January, raising it from 5 percent to 7.5 percent.

Total sales for the first five months of this year rose just 1.5 percent from a year earlier.

General Motors said sales of its vehicles and its Chinese manufacturing partners rose 9.5 percent from a year earlier to 294,425.

Ford said its sales declined 3 percent to 87,733.

Nissan said its sales rose 5.7 percent to 112,085. Year-to-date sales were 531,756.

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