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Business

China auto market grew nearly 14% in 2016

Tax break drove sales as VW returned to top spot

Volkswagen came out on top as China's new-auto market grew by double digits in 2016.

GUANGZHOU/BEIJING -- The Chinese market for new automobiles enjoyed double-digit growth last year, an industry group reported Thursday, as consumers took advantage of a small-vehicle tax break and Germany's Volkswagen reclaimed the throne.

Total sales rose 13.7% on the year to 28,028,200 domestically produced autos on a factory shipment basis, including commercial vehicles and exports, according to the China Association of Automobile Manufacturers. Passenger cars shot up 15% to 24,376,900 units, while commercial vehicles climbed 5.8% to 3,651,300. Growth stood out for passenger cars qualifying for the tax incentive launched in late 2015.

The growth was the strongest since the 13.9% of 2013 and kept China as the world's No. 1 auto market for an eighth year.

VW, its management shaken by the diesel emissions cheating scandal, nevertheless snagged the top spot back from General Motors. The American giant fell short of overall market growth as its sales climbed 7%.

South Korea's Hyundai Motor, the No. 3 seller, faced intensifying price wars with Chinese competition. Its sales grew 4.6% -- the slowest among major automakers.

Japan's Nissan Motor came in fourth, followed by U.S. automaker Ford Motor. Honda Motor claimed sixth place, and fellow Japanese automaker Toyota Motor seventh.

Great Wall Motor jumped 26% to 1.07 million vehicles, becoming the first Chinese automaker focusing solely on its own brands to break the 1 million mark. Sport utility vehicles sold particularly well.

For 2017, the association sees sales growing roughly 5% to 29.4 million. This despite the extension of the tax break, originally slated to expire at the end of 2016.

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