Robust Q1: Passenger vehicles sales set the pace

Potential buyers at an auto show in Jinan, Shandong province last December. Momentum that began in the fourth quarter of 2012 has continued into the first two months of this year. [Guo Xulei / Xinhua]

Due to the weeklong Chinese New Year holiday in February, wholesale light vehicle sales in the Chinese market declined 8.4 percent from the previous year to 1.39 million units, an expected payback for the exaggerated year-on-year sales growth of 45.5 percent in January.

February passenger vehicle sales decreased 6 percent to 1.01 million units, still outperforming the light commercial vehicle market, whose figures dropped by 15 percent to 380,000 units.

But combined sales in January and February proved that the Chinese light vehicle market continued the momentum that began in the fourth quarter of 2012 .

Year-to-date light vehicle sales rose by 17 percent from a year ago to 3.43 million units. The passenger vehicle market again led the growth, with sales jumping by 22 percent year-on-year to 2.58 million units.

The light commercial vehicle market reversed the negative trend at the beginning of 2012, with sales increasing by 6 percent year-on-year to 850,000 million units.

The market dynamics can also be proven when look at from another perspective. According to the China Passenger Car Association, retail sales of passenger cars in February decreased by 0.6 percent on an annual basis. Considering that February 2013 had 25 percent fewer working days than the previous February, daily sales could be some 30 percent higher than the same period last year.

Fundamentally, the further acceleration of light vehicle sales was underpinned by recovering economic growth and improving consumer sentiment.

China's economy is off to a good start in 2013. Fixed asset investment was up 21.2 percent year-on-year in the first two months of the year, slightly above forecasts. Export growth was also stronger than expected at a respective 25 percent and 22 percent year-on-year in January and February .

As well, the dealer inventory level last December was at an all-year low, according to the China Automobile Dealers Association. The de-inventory process in the second half of the year 2012 provided room for wholesale acceleration at the beginning of this year.

Robust light vehicle sales in the first three months this year is already guaranteed. Some clues, however, have hinted at a possible slowdown.