China's auto industry as a whole still reported lower sales in May compared to a year ago, despite an improvement from April.

China's new energy vehicle (NEV) sales rebounded sharply in May after sales plunged in April due to the Covid outbreak in several cities.

NEV sales in May were 447,000 units, up 105.2 percent year-on-year and 49.6 percent from April, according to data released today by the China Association of Automobile Manufacturers (CAAM).

New energy passenger vehicle sales in May were 427,000 units, up 108.8 percent year-on-year and up 52.5 percent from April.

Among them, pure electric passenger car sales were 327,000 units, up 97 percent year-on-year, and plug-in hybrid passenger car sales were 100,000 units, up 159.8 percent year-on-year.

From January to May, China's NEV sales were 2.003 million units, up 105.2 percent year-on-year.

China's production of NEVs was 466,000 units in May, up 113.9 percent year-on-year and up 49.5 percent from April. From January to May, China's NEV production was 2,071,000 units, up 114.2 percent year-on-year.

The export volume of NEVs in May was 43,000 units, up 130.5 percent year-on-year and 305.7 percent from April.

In contrast to the rapid growth of NEVs, the Chinese auto industry as a whole still saw lower sales in May compared to the same month last year, despite the improvement from April.

China sold 1.862 million all vehicles in May, down 12.6 percent from a year ago and up 57.6 percent from April.

In the January-May period, China's auto sales were 9.555 million units, down 12.2 percent from the same period last year.

In terms of production, China produced 1.926 million vehicles in May, down 5.7 percent year-on-year and up 59.7 percent from April. A total of 9.618 million vehicles were produced in January-May, down 9.6 percent year on year.

As a pillar of China's economy, the auto industry has strong development resilience and vitality, and with the joint efforts of all parties, the industry is expected to return to normal operation soon to, the CAAM said.

Going into June, the situation of China's auto production and sales will continue to improve as policies, including the halving of purchase taxes, begin to be implemented, the CAAM said.

On May 31, China's Ministry of Finance and the General Administration of Taxation announced a 50 percent reduction in vehicle purchase tax for passenger vehicles with a displacement of 2.0 liters or less that cost no more than 300,000 yuan ($45,060) between June 1 and December 31.

Prior to this, China's purchase tax rate for internal combustion engine (ICE) vehicles was 10 percent, while the purchase of NEVs was exempt from purchase tax.